15 U.S.C. § 717f — Construction, extension, or abandonment

Page 1192 TITLE 15—COMMERCE AND TRADE § 717d those terms are used in section 78j(b) of this title) in contravention of such rules and regula- tions as the Commission may prescribe as nec- essary in the public interest or for the protec- tion of natural gas ratepayers. Nothing in this section shall be construed to create a private right of action. (June 21, 1938, ch. 556, § 4A, as added Pub. L. 109–58, title III, § 315, Aug. 8, 2005, 119 Stat. 691.) § 717d. Fixing rates and charges; determination of cost of production or transportation (a) Decreases in rates Whenever the Commission, after a hearing had upon its own motion or upon complaint of any State, municipality, State commission, or gas distributing company, shall find that any rate, charge, or classification demanded, observed, charged, or collected by any natural-gas com- pany in connection with any transportation or sale of natural gas, subject to the jurisdiction of the Commission, or that any rule, regulation, practice, or contract affecting such rate, charge, or classification is unjust, unreasonable, unduly discriminatory, or preferential, the Commission shall determine the just and reasonable rate, charge, classification, rule, regulation, practice, or contract to be thereafter observed and in force, and shall fix the same by order: Provided, however, That the Commission shall have no power to order any increase in any rate con- tained in the currently effective schedule of such natural gas company on file with the Com- mission, unless such increase is in accordance with a new schedule filed by such natural gas company; but the Commission may order a de- crease where existing rates are unjust, unduly discriminatory, preferential, otherwise unlaw- ful, or are not the lowest reasonable rates. (b) Costs of production and transportation The Commission upon its own motion, or upon the request of any State commission, whenever it can do so without prejudice to the efficient and proper conduct of its affairs, may inves- tigate and determine the cost of the production or transportation of natural gas by a natural- gas company in cases where the Commission has no authority to establish a rate governing the transportation or sale of such natural gas. (June 21, 1938, ch. 556, § 5, 52 Stat. 823.) § 717e. Ascertainment of cost of property (a) Cost of property The Commission may investigate and ascer- tain the actual legitimate cost of the property of every natural-gas company, the depreciation therein, and, when found necessary for rate- making purposes, other facts which bear on the determination of such cost or depreciation and the fair value of such property. (b) Inventory of property; statements of costs Every natural-gas company upon request shall file with the Commission an inventory of all or any part of its property and a statement of the original cost thereof, and shall keep the Com- mission informed regarding the cost of all addi- tions, betterments, extensions, and new con- struction. (June 21, 1938, ch. 556, § 6, 52 Stat. 824.) § 717f. Construction, extension, or abandonment of facilities (a) Extension or improvement of facilities on order of court; notice and hearing Whenever the Commission, after notice and opportunity for hearing, finds such action nec- essary or desirable in the public interest, it may by order direct a natural-gas company to extend or improve its transportation facilities, to es- tablish physical connection of its transportation facilities with the facilities of, and sell natural gas to, any person or municipality engaged or legally authorized to engage in the local dis- tribution of natural or artificial gas to the pub- lic, and for such purpose to extend its transpor- tation facilities to communities immediately adjacent to such facilities or to territory served by such natural-gas company, if the Commission finds that no undue burden will be placed upon such natural-gas company thereby: Provided, That the Commission shall have no authority to compel the enlargement of transportation facili- ties for such purposes, or to compel such nat- ural-gas company to establish physical connec- tion or sell natural gas when to do so would im- pair its ability to render adequate service to its customers. (b) Abandonment of facilities or services; ap- proval of Commission No natural-gas company shall abandon all or any portion of its facilities subject to the juris- diction of the Commission, or any service ren- dered by means of such facilities, without the permission and approval of the Commission first had and obtained, after due hearing, and a find- ing by the Commission that the available supply of natural gas is depleted to the extent that the continuance of service is unwarranted, or that the present or future public convenience or ne- cessity permit such abandonment. (c) Certificate of public convenience and neces- sity (1)(A) No natural-gas company or person which will be a natural-gas company upon com- pletion of any proposed construction or exten- sion shall engage in the transportation or sale of natural gas, subject to the jurisdiction of the Commission, or undertake the construction or extension of any facilities therefor, or acquire or operate any such facilities or extensions thereof, unless there is in force with respect to such nat- ural-gas company a certificate of public conven- ience and necessity issued by the Commission authorizing such acts or operations: Provided, however, That if any such natural-gas company or predecessor in interest was bona fide engaged in transportation or sale of natural gas, subject to the jurisdiction of the Commission, on Feb- ruary 7, 1942, over the route or routes or within the area for which application is made and has so operated since that time, the Commission shall issue such certificate without requiring further proof that public convenience and neces- sity will be served by such operation, and with- out further proceedings, if application for such certificate is made to the Commission within ninety days after February 7, 1942. Pending the Page 1193 TITLE 15—COMMERCE AND TRADE § 717f determination of any such application, the con- tinuance of such operation shall be lawful. (B) In all other cases the Commission shall set the matter for hearing and shall give such rea- sonable notice of the hearing thereon to all in- terested persons as in its judgment may be nec- essary under rules and regulations to be pre- scribed by the Commission; and the application shall be decided in accordance with the proce- dure provided in subsection (e) of this section and such certificate shall be issued or denied ac- cordingly: Provided, however, That the Commis- sion may issue a temporary certificate in cases of emergency, to assure maintenance of ade- quate service or to serve particular customers, without notice or hearing, pending the deter- mination of an application for a certificate, and may by regulation exempt from the require- ments of this section temporary acts or oper- ations for which the issuance of a certificate will not be required in the public interest. (2) The Commission may issue a certificate of public convenience and necessity to a natural- gas company for the transportation in interstate commerce of natural gas used by any person for one or more high-priority uses, as defined, by rule, by the Commission, in the case of— (A) natural gas sold by the producer to such person; and (B) natural gas produced by such person. (d) Application for certificate of public conven- ience and necessity Application for certificates shall be made in writing to the Commission, be verified under oath, and shall be in such form, contain such in- formation, and notice thereof shall be served upon such interested parties and in such manner as the Commission shall, by regulation, require. (e) Granting of certificate of public convenience and necessity Except in the cases governed by the provisos contained in subsection (c)(1) of this section, a certificate shall be issued to any qualified appli- cant therefor, authorizing the whole or any part of the operation, sale, service, construction, ex- tension, or acquisition covered by the applica- tion, if it is found that the applicant is able and willing properly to do the acts and to perform the service proposed and to conform to the pro- visions of this chapter and the requirements, rules, and regulations of the Commission there- under, and that the proposed service, sale, oper- ation, construction, extension, or acquisition, to the extent authorized by the certificate, is or will be required by the present or future public convenience and necessity; otherwise such appli- cation shall be denied. The Commission shall have the power to attach to the issuance of the certificate and to the exercise of the rights granted thereunder such reasonable terms and conditions as the public convenience and neces- sity may require. (f) Determination of service area; jurisdiction of transportation to ultimate consumers (1) The Commission, after a hearing had upon its own motion or upon application, may deter- mine the service area to which each authoriza- tion under this section is to be limited. Within such service area as determined by the Commis- sion a natural-gas company may enlarge or ex- tend its facilities for the purpose of supplying increased market demands in such service area without further authorization; and (2) If the Commission has determined a service area pursuant to this subsection, transportation to ultimate consumers in such service area by the holder of such service area determination, even if across State lines, shall be subject to the exclusive jurisdiction of the State commission in the State in which the gas is consumed. This section shall not apply to the transportation of natural gas to another natural gas company. (g) Certificate of public convenience and neces- sity for service of area already being served Nothing contained in this section shall be con- strued as a limitation upon the power of the Commission to grant certificates of public con- venience and necessity for service of an area al- ready being served by another natural-gas com- pany. (h) Right of eminent domain for construction of pipelines, etc. When any holder of a certificate of public con- venience and necessity cannot acquire by con- tract, or is unable to agree with the owner of property to the compensation to be paid for, the necessary right-of-way to construct, operate, and maintain a pipe line or pipe lines for the transportation of natural gas, and the necessary land or other property, in addition to right-of- way, for the location of compressor stations, pressure apparatus, or other stations or equip- ment necessary to the proper operation of such pipe line or pipe lines, it may acquire the same by the exercise of the right of eminent domain in the district court of the United States for the district in which such property may be located, or in the State courts. The practice and proce- dure in any action or proceeding for that pur- pose in the district court of the United States shall conform as nearly as may be with the prac- tice and procedure in similar action or pro- ceeding in the courts of the State where the property is situated: Provided, That the United States district courts shall only have jurisdic- tion of cases when the amount claimed by the owner of the property to be condemned exceeds $3,000. (June 21, 1938, ch. 556, § 7, 52 Stat. 824; Feb. 7, 1942, ch. 49, 56 Stat. 83; July 25, 1947, ch. 333, 61 Stat. 459; Pub. L. 95–617, title VI, § 608, Nov. 9, 1978, 92 Stat. 3173; Pub. L. 100–474, § 2, Oct. 6, 1988, 102 Stat. 2302.) Editorial Notes AMENDMENTS 1988—Subsec. (f). Pub. L. 100–474 designated existing provisions as par. (1) and added par. (2). 1978—Subsec. (c). Pub. L. 95–617, § 608(a), (b)(1), des- ignated existing first paragraph as par. (1)(A) and exist- ing second paragraph as par. (1)(B) and added par. (2). Subsec. (e). Pub. L. 95–617, § 608(b)(2), substituted ‘‘subsection (c)(1)’’ for ‘‘subsection (c)’’. 1947—Subsec. (h). Act July 25, 1947, added subsec. (h). 1942—Subsecs. (c) to (g). Act Feb. 7, 1942, struck out subsec. (c), and added new subsecs. (c) to (g). Page 1194 TITLE 15—COMMERCE AND TRADE § 717g Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 1988 AMENDMENT Pub. L. 100–474, § 3, Oct. 6, 1988, 102 Stat. 2302, provided that: ‘‘The provisions of this Act [amending this sec- tion and enacting provisions set out as a note under section 717w of this title] shall become effective one hundred and twenty days after the date of enactment [Oct. 6, 1988].’’ Executive Documents TRANSFER OF FUNCTIONS Enforcement functions of Secretary or other official in Department of Energy and Commission, Commis- sioners, or other official in Federal Energy Regulatory Commission related to compliance with certificates of public convenience and necessity issued under this sec- tion with respect to pre-construction, construction, and initial operation of transportation system for Ca- nadian and Alaskan natural gas transferred to Federal Inspector, Office of Federal Inspector for Alaska Nat- ural Gas Transportation System, until first anniver- sary of date of initial operation of Alaska Natural Gas Transportation System, see Reorg. Plan No. 1 of 1979, §§ 102(d), 203(a), 44 F.R. 33663, 33666, 93 Stat. 1373, 1376, ef- fective July 1, 1979, set out under section 719e of this title. Office of Federal Inspector for the Alaska Natural Gas Transportation System abolished and functions and authority vested in Inspector transferred to Sec- retary of Energy by section 3012(b) of Pub. L. 102–486, set out as an Abolition of Office of Federal Inspector note under section 719e of this title. Functions and au- thority vested in Secretary of Energy subsequently transferred to Federal Coordinator for Alaska Natural Gas Transportation Projects by section 720d(f) of this title. § 717g. Accounts; records; memoranda (a) Rules and regulations for keeping and pre- serving accounts, records, etc. Every natural-gas company shall make, keep, and preserve for such periods, such accounts, records of cost-accounting procedures, cor- respondence, memoranda, papers, books, and other records as the Commission may by rules and regulations prescribe as necessary or appro- priate for purposes of the administration of this chapter: Provided, however, That nothing in this chapter shall relieve any such natural-gas com- pany from keeping any accounts, memoranda, or records which such natural-gas company may be required to keep by or under authority of the laws of any State. The Commission may pre- scribe a system of accounts to be kept by such natural-gas companies, and may classify such natural-gas companies and prescribe a system of accounts for each class. The Commission, after notice and opportunity for hearing, may deter- mine by order the accounts in which particular outlays or receipts shall be entered, charged, or credited. The burden of proof to justify every ac- counting entry questioned by the Commission shall be on the person making, authorizing, or requiring such entry, and the Commission may suspend a charge or credit pending submission of satisfactory proof in support thereof. (b) Access to and inspection of accounts and records The Commission shall at all times have access to and the right to inspect and examine all ac- counts, records, and memoranda of natural-gas companies; and it shall be the duty of such nat- ural-gas companies to furnish to the Commis- sion, within such reasonable time as the Com- mission may order, any information with re- spect thereto which the Commission may by order require, including copies of maps, con- tracts, reports of engineers, and other data, rec- ords, and papers, and to grant to all agents of the Commission free access to its property and its accounts, records, and memoranda when re- quested so to do. No member, officer, or em- ployee of the Commission shall divulge any fact or information which may come to his knowl- edge during the course of examination of books, records, data, or accounts, except insofar as he may be directed by the Commission or by a court. (c) Books, accounts, etc., of the person control- ling gas company subject to examination The books, accounts, memoranda, and records of any person who controls directly or indirectly a natural-gas company subject to the jurisdic- tion of the Commission and of any other com- pany controlled by such person, insofar as they relate to transactions with or the business of such natural-gas company, shall be subject to examination on the order of the Commission. (June 21, 1938, ch. 556, § 8, 52 Stat. 825.) § 717h. Rates of depreciation (a) Depreciation and amortization The Commission may, after hearing, require natural-gas companies to carry proper and ade- quate depreciation and amortization accounts in accordance with such rules, regulations, and forms of account as the Commission may pre- scribe. The Commission may from time to time ascertain and determine, and by order fix, the proper and adequate rates of depreciation and amortization of the several classes of property of each natural-gas company used or useful in the production, transportation, or sale of nat- ural gas. Each natural-gas company shall con- form its depreciation and amortization accounts to the rates so ascertained, determined, and fixed. No natural-gas company subject to the ju- risdiction of the Commission shall charge to op- erating expenses any depreciation or amortiza- tion charges on classes of property other than those prescribed by the Commission, or charge with respect to any class of property a percent- age of depreciation or amortization other than that prescribed therefor by the Commission. No such natural-gas company shall in any case in- clude in any form under its operating or other expenses any depreciation, amortization, or other charge or expenditure included elsewhere as a depreciation or amortization charge or oth- erwise under its operating or other expenses. Nothing in this section shall limit the power of a State commission to determine in the exercise of its jurisdiction, with respect to any natural- gas company, the percentage rates of deprecia- tion or amortization to be allowed, as to any class of property of such natural-gas company, or the composite depreciation or amortization rate, for the purpose of determining rates or charges. (b) Rules The Commission, before prescribing any rules or requirements as to accounts, records, or