[Code of Federal Regulations]
[Title 18, Volume 1]
[Revised as of April 1, 2003]
From the U.S. Government Printing Office via GPO Access
[CITE: 18CFR154.501]

[Page 464-466]
 
           TITLE 18--CONSERVATION OF POWER AND WATER RESOURCES
 
  CHAPTER I--FEDERAL ENERGY REGULATORY COMMISSION, DEPARTMENT OF ENERGY
 
PART 154--RATE SCHEDULES AND TARIFFS--Table of Contents
 
                     Subpart F--Refunds and Reports
 
Sec. 154.501  Refunds.


    (a) Refund Obligation. (1) Any natural gas company that collects 
rates or charges pursuant to this chapter must refund that portion of 
any increased rates or charges either found by the Commission not to be 
justified, or approved for refund by the Commission as part of a 
settlement, together with interest as required in paragraph (d) of this 
section. The refund plus interest must be distributed as specified in 
the Commission order requiring or approving the refund, or if no date is 
specified, within 60 days of a final order. For purposes of this 
paragraph, a final

[[Page 465]]

order is an order no longer subject to rehearing. The pipeline is not 
required to make any refund until it has collected the refundable money 
through its rates.
    (2) Any natural gas company must refund to its jurisdictional 
customers the jurisdictional portion of any refund it receives which is 
required by prior Commission order to be flowed through to its 
jurisdictional customers or represents the refund of an amount 
previously included in a filing under Sec. 154.403 and charged and 
collected from jurisdictional customers within thirty days of receipt or 
other time period established by the Commission or as established in the 
pipeline's tariff.
    (b) Costs of Refunding. Any natural gas company required to make 
refunds pursuant to this section must bear all costs of such refunding.
    (c) Supplier Refunds. The jurisdictional portion of supplier refunds 
(including interest received), applicable to periods in which a 
purchased gas adjustment clause was in effect, must be flowed through to 
the natural gas company's jurisdictional gas sales customers during that 
period with interest as computed in paragraph (d) of this section.
    (d) Interest on Refunds. Interest on the refund balance must be 
computed from the date of collection from the customer until the date 
refunds are made as follows:
    (1) At an average prime rate for each calendar quarter on all 
excessive rates or charges held (including all interest applicable to 
such rates and charges) on or after October 1, 1979. The applicable 
average prime rate for each calendar quarter must be the arithmetic 
mean, to the nearest one-hundredth of one percent, of the prime rate 
values published in the Federal Reserve Bulletin, or in the Federal 
Reserve's ``Selected Interest Rates'' (Statistical Release G, 13), for 
the fourth, third, and second months preceding the first month of the 
calendar quarter.
    (2) The interest required to be paid under paragraph (d)(1) of this 
section must be compounded quarterly.
    (3) The refund balance must be either:
    (i) The revenues resulting from the collection of the portion of any 
increased rates or charges found by the Commission not to be justified; 
or
    (ii) An amount agreed upon in a settlement approved by the 
Commission; or
    (iii) The jurisdictional portion of a refund the natural gas company 
receives.
    (e) Unless otherwise provided by the order, settlement or tariff 
provision requiring the refund, the natural gas company must file a 
report of refunds, within 30 days of the date the refund was made, which 
complies with Sec. 154.502 and includes the following:
    (1) Workpapers and a narrative sufficient to show how the refunds 
for jurisdictional services were calculated;
    (2) Workpapers and a narrative sufficient to determine the origin of 
the refund, including step-by-step calculations showing the derivation 
of the refund amount described in paragraph (d)(3) of this section, if 
necessary;
    (3) References to any publicly available sources which confirm the 
rates, quantities, or costs, which are used to calculate the refund 
balance or which confirm the refund amount itself. If the rate, 
quantity, cost or refund does not directly tie to the source, a 
workpaper must be included to show the reconciliation between the rate, 
quantity, cost, or refund in the natural gas company's report and the 
corresponding rate, quantity, cost or refund in the source document;
    (4) Workpapers showing the calculation of interest on a monthly 
basis, including how the carrying charges were compounded quarterly;
    (5) Workpapers and a narrative explaining how the refund was 
allocated to each jurisdictional customer. Where the numbers used to 
support the allocation are publicly available, a reference to the source 
must be included. Where the allocation methodology has been approved 
previously, a reference to the order or tariff provision approving the 
allocation methodology must be included.
    (6) A letter of transmittal containing:
    (i) A list of the material enclosed;
    (ii) The name and telephone number of a company official who can 
answer questions regarding the filing;

[[Page 466]]

    (iii) A statement of the date the refund was disbursed;
    (iv) A reference to the authority by which the refund is made, 
including the specific subpart of these regulations, an order of the 
Commission, a provision of the company's tariff, or any other 
appropriate authority. If a Commission order is referenced, include the 
citation to the FERC Reports, the date of issuance, and the docket 
number;
    (v) Any requests for waiver. Requests must include a reference to 
the specific section of the statute, regulations, or the company's 
tariff from which waiver is sought, and a justification for the waiver.
    (7) A certification of service to all affected customers and 
interested state commissions.
    (f) Each report filed under paragraph (e) of this section must be 
posted no later than the date of filing. Each report must be posted to 
all recipients of a share of the refund and all state commissions whose 
jurisdiction includes the location of any recipient of a refund share 
that have made a standing request for such full report.
    (g) Recipients of refunds and state commissions that have not made a 
standing request for such full report shall receive an abbreviated 
report consisting of the items listed in Sec. 154.501 (e)(5) and (e)(6).

[Order 582, 60 FR 52996, Oct.11, 1995, as amended by Order 582-A, 61 FR 
9629, Mar. 11, 1996]