15 U.S.C. § 3363 — Emergency allocation authority

Page 2003 TITLE 15—COMMERCE AND TRADE § 3363 SUBCHAPTER III—ADDITIONAL AUTHORITIES AND REQUIREMENTS PART A—EMERGENCY AUTHORITY § 3361. Declaration of emergency (a) Presidential declaration The President may declare a natural gas sup- ply emergency (or extend a previously declared emergency) if he finds that— (1) a severe natural gas shortage, endan- gering the supply of natural gas for high-pri- ority uses, exists or is imminent in the United States or in any region thereof; and (2) the exercise of authorities under section 3362 or section 3363 of this title is reasonably necessary, having exhausted other alter- natives to the maximum extent practicable, to assist in meeting natural gas requirements for such high-priority uses. (b) Limitation (1) Expiration Any declaration of a natural gas supply emergency (or extension thereof) under sub- section (a), shall terminate at the earlier of— (A) the date on which the President finds that any shortage described in subsection (a) does not exist or is not imminent; or (B) 120 days after the date of such declara- tion of emergency (or extension thereof). (2) Extensions Nothing in this subsection shall prohibit the President from extending, under subsection (a), any emergency (or extension thereof), pre- viously declared under subsection (a), upon the expiration of such declaration of emer- gency (or extension thereof) under paragraph (1)(B). (Pub. L. 95–621, title III, § 301, Nov. 9, 1978, 92 Stat. 3381.) Executive Documents DELEGATION OF FUNCTIONS Functions of President under this subchapter, except for authority to declare, extend, and terminate a na- tional gas supply emergency pursuant to this section, delegated to Secretary of Energy, see section 1–101 of Ex. Ord. No. 12235, Sept. 3, 1980, 45 F.R. 58803, set out as a note under section 3364 of this title. § 3362. Emergency purchase authority (a) Presidential authorization During any natural gas supply emergency de- clared under section 3361 of this title, the Presi- dent may, by rule or order, authorize any inter- state pipeline or local distribution company served by any interstate pipeline to contract, upon such terms and conditions as the President determines to be appropriate (including provi- sions respecting fair and equitable prices), for the purchase of emergency supplies of natural gas— (1) from any producer of natural gas (other than a producer who is affiliated with the pur- chaser, as determined by the President) if— (A) such natural gas is not produced from the Outer Continental Shelf; and (B) the sale or transportation of such nat- ural gas was not pursuant to a certificate issued under the Natural Gas Act [15 U.S.C. 717 et seq.] immediately before the date on which such contract was entered into; or (2) from any intrastate pipeline, local dis- tribution company, or other person (other than an interstate pipeline or a producer of natural gas). (b) Contract duration The duration of any contract authorized under subsection (a) may not exceed 4 months. The preceding sentence shall not prohibit the Presi- dent from authorizing under subsection (a) a re- newal of any contract, previously authorized under such subsection, following the expiration of such contract. (c) Related transportation and facilities The President may, by order, require any pipe- line to transport natural gas, and to construct and operate such facilities for the transpor- tation of natural gas, as he determines nec- essary to carry out any contract authorized under subsection (a). The costs of any construc- tion or transportation ordered under this sub- section shall be paid by the purchaser of natural gas under the contract with respect to which such order is issued. No order to transport nat- ural gas under this subsection shall require any pipeline to transport natural gas in excess of such pipeline’s available capacity. (d) Maintenance of adequate records The Commission shall require any interstate pipeline or local distribution company con- tracting under the authority of this section for natural gas to maintain and make available full and adequate records concerning transactions under this section, including records of the vol- umes of natural gas purchased under the author- ity of this section and the rates and charges for purchase and receipt of such natural gas. (e) Special limitation No sale under any emergency purchase con- tract under this section for emergency supplies of natural gas for sale and delivery from any intrastate pipeline which is operating under court supervision as of January 1, 1977, may take effect unless the court approves. (Pub. L. 95–621, title III, § 302, Nov. 9, 1978, 92 Stat. 3382.) Editorial Notes REFERENCES IN TEXT The Natural Gas Act, referred to in subsec. (a)(1)(B), is act June 21, 1938, ch. 556, 52 Stat. 821, which is classi- fied generally to chapter 15B (§ 717 et seq.) of this title. For complete classification of this act to the Code, see section 717w of this title and Tables. § 3363. Emergency allocation authority (a) In general In order to assist in meeting natural gas re- quirements for high-priority uses of natural gas during any natural gas supply emergency de- clared under section 3361 of this title, the Presi- dent may, by order, allocate supplies of natural gas under subsections (b), (c), and (d) to— Page 2004 TITLE 15—COMMERCE AND TRADE § 3363 1 So in original. 2 So in original. Par. (2) enacted without a subpar. (B). (1) any interstate pipeline; (2) any local distribution company— (A) which is served by any interstate pipe- line; (B) which is providing natural gas only for high-priority uses; and (C) which is in need of deliveries of natural gas to assist in meeting natural gas require- ments for high-priority uses of natural gas; and (3) any person for meeting requirements of high-priority uses of natural gas. (b) Allocation of certain boiler fuel gas (1) Required finding The President shall not allocate supplies of natural gas under this subsection unless he finds that— (A) to the maximum extent practicable, emergency purchase authority under section 3362 of this title has been utilized to assist in meeting natural gas requirements for high- priority uses of natural gas; (B) emergency purchases of natural gas supplies under section 3362 of this title are not likely to satisfy the natural gas require- ments for such high-priority uses; (C) the exercise of authority under this subsection is reasonably necessary to assist in meeting natural gas requirements for such high-priority uses; and (D) any interstate pipeline or local dis- tribution company receiving such natural gas has ordered the termination of all deliv- eries of natural gas for other than high-pri- ority uses and attempted to to 1 the max- imum extent practicable to terminate such deliveries. (2) Allocation authority Subject to paragraph (1), in order to assist in meeting natural gas requirements for high-pri- ority uses of natural gas, the President may, by order, allocate supplies of natural gas the use of which has been prohibited by the Presi- dent pursuant to authority under section 717z of this title (relating to the use of natural gas as a boiler fuel during any natural gas supply emergency). (c) Allocation of general pipeline supply (1) Required findings The President shall not allocate supplies of natural gas under this subsection unless he finds that— (A) to the maximum extent practicable, al- location of supplies of natural gas under sub- section (b) has been utilized to assist in meeting natural gas requirements for high- priority uses of natural gas; (B) the exercise of such authority is not likely to satisfy the natural gas require- ments for such high-priority uses; (C) the exercise of authority under this subsection is reasonably necessary to assist in meeting natural gas requirements for such high-priority uses; (D) any interstate pipeline or local dis- tribution company receiving such natural gas has ordered the termination of all deliv- eries of natural gas for other than high-pri- ority uses and attempted to the maximum extent practicable to terminate such deliv- eries; (E) such allocation will not create, for the interstate pipeline delivering certificated natural gas, a supply shortage which will cause such pipeline to be unable to meet the natural gas requirements for high-priority uses of natural gas served, directly or indi- rectly, by such pipeline; and (F) such allocation will not result in a dis- proportionate share of deliveries and result- ing curtailments of natural gas being experi- enced by such interstate pipeline when com- pared to deliveries and resulting curtail- ments which are experienced as a result of orders issued under this subsection applica- ble to other interstate pipelines (as deter- mined by the President). (2) Required notification from State (A) 2 Notification The President shall not allocate supplies of natural gas under this subsection unless he is notified by the Governor of any State that— (i) a shortage of natural gas supplies available to such State exists or is immi- nent; (ii) such shortage or imminent shortage endangers the supply of natural gas for high-priority uses in such State; and (iii) the exercise of authority under State law is inadequate to protect high- priority uses of natural gas in such State from an interruption in natural gas sup- plies. (3) Basis of finding To the maximum extent practicable, the Governor shall submit, together with any no- tification under subparagraph (A), information upon which he has based his finding under such subparagraph, including— (i) volumes of natural gas required to meet the natural gas requirements for high-pri- ority uses of natural gas in such State; (ii) information received from persons in the business of producing, selling, trans- porting, or delivering natural gas in such State as to the volumes of natural gas sup- plies available to such State; (iii) information on the authority under State law which will be exercised to protect high-priority uses; and (iv) such other information which the President requests or which the Governor determines appropriate to apprise the Presi- dent of emergency deliveries and transpor- tation of interstate natural gas needed by such State. (4) Allocation authority Subject to paragraphs (1), (2), and (5), in order to assist in meeting natural gas require- ments for high-priority uses of natural gas, the President may, by order, allocate supplies of certificated natural gas from any interstate pipeline. Page 2005 TITLE 15—COMMERCE AND TRADE § 3363 (5) Consideration of alternative fuel avail- ability In issuing any order under this subsection the President shall consider the relative avail- ability of alternative fuel to natural gas users supplied by the interstate pipeline ordered to make deliveries pursuant to this subsection. (d) Allocation of user-owned gas (1) Required finding The President shall not allocate supplies of natural gas under this subsection unless he finds that— (A) to the maximum extent practicable, al- location of supplies of natural gas under sub- section (c) has been utilized to assist in meeting natural gas requirements for high- priority uses of natural gas; (B) the exercise of such authority is not likely to satisfy the natural gas require- ments for such high-priority uses; (C) the exercise of authority under this subsection is reasonably necessary to assist in meeting natural gas requirements for such high-priority uses; (D) any interstate pipeline or local dis- tribution company receiving such natural gas has ordered the termination of all deliv- eries of natural gas for other than high-pri- ority uses and attempted to the maximum extent practicable to terminate such deliv- eries; and (E) such allocation will not create, for the person who owns and would otherwise use such natural gas, a supply shortage which will cause such person to be unable to sat- isfy such person’s natural gas requirements for high-priority uses. (2) Allocation authority Subject to paragraphs (1) and (3), in order to assist in meeting natural gas requirements for high-priority uses of natural gas, the Presi- dent may, by order, allocate supplies of nat- ural gas which would be certificated natural gas but for the second sentence of section 3301(19) of this title. (3) Consideration of economic feasibility of al- ternative fuels In issuing any order under this subsection, the President shall consider the economic fea- sibility of alternative fuels available to the user which owned the natural gas subject to an order under this subsection. (e) Limitation No order may be issued under this section un- less the President determines that such order will not require transportation of natural gas by any pipeline in excess of its available transpor- tation capacity. (f) Industry assistance The President may request that representa- tives of pipelines, local distribution companies, and other persons meet and provide assistance to the President in carrying out his authority under this section. (g) Compensation (1) In general If the parties to any order issued under sub- section (b), (c), (d), or (h) fail to agree upon the terms of compensation for natural gas de- liveries or transportation required pursuant to such order, the President, after a hearing held either before or after such order takes effect, shall, by supplemental order, prescribe the amount of compensation to be paid for such deliveries or transportation and for any other expenses incurred in delivering or trans- porting natural gas. (2) Calculation of compensation for certain boiler fuel natural gas For purposes of any supplemental order under paragraph (1) with respect to emergency deliveries pursuant to subsection (b), the President shall calculate the amount of com- pensation— (A) for supplies of natural gas based upon the amount required to make whole the user subject to the prohibition order, but in no event may such compensation exceed just compensation prescribed in section 717z of this title; and (B) for transportation, storage, delivery, and other services, based upon reasonable costs, as determined by the President. (3) Compensation for other natural gas allo- cated For the purpose of any supplemental order under paragraph (1), if the party making emer- gency deliveries pursuant to subsection (c) or (d)— (A) indicates a preference for compensa- tion in kind, the President shall direct that compensation in kind be provided as expedi- tiously as practicable; (B) indicates a preference for compensa- tion, or the President determines that, not- withstanding paragraph (A) of this sub- section, any portion thereof cannot prac- ticably be compensated in kind, the Presi- dent shall calculate the amount of com- pensation— (i) for supplies of natural gas, based upon the amount required to make the pipeline and its local distribution companies whole, in the case of any order under subsection (c), or to make the user from whom nat- ural gas is allocated whole, in the case of any order under subsection (d) including any amount actually paid by such pipeline and its local distribution companies or such user for volumes of natural gas or higher cost synthetic gas acquired to re- place natural gas subject to an order under subsection (c) or (d); and (ii) for transportation, storage, delivery, and other services, based upon reasonable costs, as determined by the President. Compensation received by an interstate pipeline under this subsection shall be credited to the account of any local dis- tribution company served by that pipeline to the extent ordered by the President to make such local distribution company whole. (h) Related transportation and facilities The President may, by order, require any pipe- line to transport natural gas, and to construct and operate such facilities for the transpor- Page 2006 TITLE 15—COMMERCE AND TRADE § 3364 1 So in original. Probably should be ‘‘(C)’’. tation of natural gas, as he determines nec- essary to carry out any order under subsection (b), (c), or (d). Compensation for the costs of any construction or transportation ordered under this subsection shall be determined under sub- section (g) and shall be paid by the person to whom supplies of natural gas are ordered allo- cated under this section. (i) Monitoring In order to effect the purposes of this part, the President shall monitor the operation of any order made pursuant to this section to assure that natural gas delivered pursuant to this sec- tion is applied to high-priority uses only. (j) Commission study Not later than June 1, 1979, the Commission shall prepare and submit to the Congress a re- port regarding whether authority to allocate natural gas, which is not otherwise subject to allocation under this part, is likely to be nec- essary to meet high-priority uses. (k) ‘‘High-priority use’’ defined For purposes of this section, the term ‘‘high- priority use’’ means any— (1) use of natural gas in a residence; (2) use of natural gas in a commercial estab- lishment in amounts less than 50 Mcf on a peak day; or (3) any use of natural gas the curtailment of which the President determines would endan- ger life, health, or maintenance of physical property. (Pub. L. 95–621, title III, § 303, Nov. 9, 1978, 92 Stat. 3383.) § 3364. Miscellaneous provisions (a) Information (1) Obtaining of information In order to obtain information to carry out his authority under this part, the President may— (A) sign and issue subpenas for the attend- ance and testimony of witnesses and the pro- duction of books, records, papers, and other documents; (B) require any person, by general or spe- cial order, to submit answers in writing to interrogatories, requests for reports or for other information, and such answers shall be made within such reasonable period, and under oath or otherwise as the President may determine; and (c) 1 secure, upon request, any information from any Federal agency. (2) Enforcement of subpenas and orders The appropriate United States district court may, upon petition of the Attorney General at the request of the President, in the case of re- fusal to obey a subpena or order of the Presi- dent issued under this subsection, issue an order requiring compliance therewith, and any failure to obey an order of the court may be punished by the court as a contempt thereof. (b) Reporting of prices and volumes In issuing any order under section 3362 or 3363 of this title, the President shall require that the prices and volumes of natural gas delivered, transported, or contracted for pursuant to such order shall be reported to him on a weekly basis. Such reports shall be made available to the Con- gress. (c) Presidential reports to Congress The President shall report to the Congress, not later than 90 days following the termination under section 3361(b) of this title of any declara- tion of a natural gas supply emergency (or ex- tension thereof) under section 3361(a) of this title, respecting the exercise of authority under section 3361, 3362, 3363 of this title, or this sec- tion. (d) Delegation of authorities The President may delegate all or any portion of the authority granted to him under section 3361, 3362, 3363 of this title, or this section to such Federal officers or agencies as he deter- mines appropriate, and may authorize such re- delegation as may be appropriate. Except with respect to section 552 of title 5, any Federal offi- cer or agency to which authority is delegated or redelegated under this subsection shall be sub- ject only to such procedural requirements re- specting the exercise of such authority as the President would be subject to if such authority were not so delegated. (e) Antitrust protections (1) Defenses There shall be available as a defense for any person to civil or criminal action brought for violation of the Federal antitrust laws (or any similar law of any State) with respect to any action taken, or meeting held, pursuant to any order of the President under section 3363(b), (c), (d), or (i) of this title, or any meeting held pursuant to a request of the President under section 3363(g) of this title, if— (A) such action was taken or meeting held solely for the purpose of complying with the President’s request or order; (B) such action was not taken for the pur- pose of injuring competition; and (C) any such meeting complied with the re- quirements of paragraph (2). Persons interposing the defense provided by this subsection shall have the burden of proof, except that the burden shall be on the person against whom the defense is asserted with re- spect to whether the actions were taken for the purpose of injuring competition. (2) Requirements of meetings With respect to any meeting held pursuant to a request by the President under section 3363(g) of this title or pursuant to an order under section 3363 of this title— (A) there shall be present at such meeting a full-time Federal employee designated for such purposes by the Attorney General; (B) a full and complete record of such meeting shall be taken and deposited, to- gether with any agreements resulting there- from, with the Attorney General, who shall make it available for public inspection and copying; (C) the Attorney General and the Federal Trade Commission shall have the oppor-