2010 NARUC Annual Conference

1. 2010 NARUCAnnual Conference Atlanta, Georgia November 15, 2010

2. Discussion Topics • Introduction – Its Been a Rough Year • Partnership – Over 40 Years • Responsibility and Accountability • Challenges Ahead • “Asks” for Each Commissioner

3. Recent High Profile Accidents • Deepwater Horizon • Not Involved – Honest – Don’t Draw Parallels • Marshal, Michigan • Major Crude Oil Spill Dramatically Impacted Several Communities in Michigan • Romeoville, Illinois • Followed Closely on the Heels of Marshal • San Bruno, California • Major tragedy – Unimaginable Proportions • What Do These Have in Common? • Perhaps Very Little – NTSB Will Determine

6. Partnership • U.S. Congress charges the Secretary of US DOT • Congress Allows the Secretary to Partner with the States • US DOT (PHMSA) sets National Standards • States can exceed these where appropriate • Secretary provides grants to the States, but much more • Training, true partnership in regulations, tech., etc • Bottom Line: Good value for the U.S. / Good sense

7. Responsibility • Virtually ALL Commissioners have responsibility, and from it flows accountability • The past 2 reauthorizations have focused on OPS; this one may focus as much on the States performance • Transparency is pushing the accountability agenda • See APPENDIX for examples from OPS’ website

8. Challenges Ahead • Implementing all the regulatory changes emanating from the last reauthorization – e.g., DIMP, CRM, DP • Infrastructure integrity – its about more than just age • Excavation Damage Prevention – we NEED your help! • Not to do our best risks losing control of OUR agenda

9. “Asks • True “Consumer Advocacy” involves more than minimizing rates – and safety needs to be accounted • Assess YOUR state’s risks – see, for example, data OPS provides (APPENDIX) • Support YOUR Pipeline Safety Staff • We are trying to help with funding, but they need your leadership and financial and staffing support • Use ALL of the tools available to you to change performance – can’t shy away from enforcement where it is warranted

10. Regulatory Update • Major Rulemaking Efforts & Status • Distribution Integrity Management Program (8/2011) • Control Room Management (Fall 2011) • NPRM Proposal to Accelerate Implementation • ANPRM Questions on Hazardous Liquid Requirements • Upcoming Regulatory Actions • Low Stress HL’s – Phase 2: Final Rule in 2010 • Excavation Damage Enforcement: NPRM in 2010 • ANPRM on Natural Gas Requirements • Minor Rulemaking & Miscellaneous • “One Rule” & Advisories – Emergency Plans, Federal Response Plans, and Data Reporting (soon)

11. Concluding Remarks / Q & A For more information on PHMSA http://www.phmsa.dot.gov For more information on Pipeline Safety http://ops.dot.gov Thanks for your time & enjoy the week(end)!

12. Administration’s Reauthorization Proposal • Key Themes • More Inspection • Stronger Enforcement • Fewer Statutory Exemptions • Special Services - Pay as You Go • Special Permits • Major Construction Projects • Publicly Conducted Studies • Expansion of HCA’s or Alternatives

13. Policy Initiatives and Priorities • Data Driven, Risk Informed & Transparent • Operator Pilot & Operator Pages • Long Term Plan • New Construction Oversight • Special Permits – Performance Matters • Public Awareness Oversight • Accelerating Enforcement • Completion and Launch of PIPA Best Practices • Supporting State Damage Prevention Improvements • Gaps, Overlaps, and Alignment Study

14. Non-Regulatory Initiatives Update • Damage prevention • Common Ground Alliance & Regional Partners • State Damage Prevention Assistance Program • State Damage Prevention Characterization Tools • Technology Improvements to One-Call Process • 811 Promotion Campaign • Public Communications and Awareness • Stakeholder Communications, mapping & ET • ROW Encroachment – PIPA Completion/Launch • Emergency responders – training and partners • Research and development

15. APPENDIX State Information Presented on the Stakeholder Communications Website State-specific information can be accessed from the drop down box found in the left-hand menu on each page of the Stakeholder Communications website.

18. State pages also accessed via a link on the main I&M Page

19. State Pages • Generically describe pipeline infrastructure in state to possibly include transmission and distribution systems. • Note that pipelines are safest method for transporting but can present significant risks to the public and the environment. • Encourage users to learn about pipelines and steps to help ensure pipeline safety in community. • Include links to more state-specific information. • State pipeline profile: incident and mileage data • State pipeline profile: enforcement data • Who regulates pipelines in state? • The role of the states in pipeline safety (NAPSR link) • State web site (if available)

21. State Significant Incidents and Mileage Overview Pages • Provide details and incident history for the pipeline systems in each state. • Limited to significant incidents over specified period. Provide links to reports showing incident causes. • Data sources are the PHMSA Flagged Incident Files, and: • Hazardous Liquid - National Pipeline Mapping System • Gas Transmission - National Pipeline Mapping System • Gas Gathering - Calendar Year 2009 Annual Reports • Gas Distribution - Calendar Year 2009 Annual Reports • Current mileages are for 2009 and are noted as approximate as some data sources may be incomplete for the year. • Link to State Significant Incident Detail Listing for more information about each significant incident in state. • Link to State Pipeline Safety Regulatory Fact Sheet

30. State Enforcement Program Pages • Note operator compliance with state and federal pipeline safety regulations is monitored through comprehensive I&E program comprised of: • field inspections of O&M and construction activities; • programmatic inspections of operator procedures, processes, and records; • incident investigations and corrective actions; and • direct dialogue with operator management. • Note state agencies work in partnership with PHMSA. • Provide summary tables of probable violations discovered and compliance actions taken by state agencies. • Note data are reported annually as part of the state's annual pipeline safety program certification or agreement to PHMSA.

33. State Regulatory Pages (Fact Sheets) • Note pipeline safety standards established under 49 CFR Parts 190 - 199. • Note PHMSA has overall regulatory responsibility for hazardous liquid and gas pipelines under its jurisdiction. • Identify who inspects and enforces in state. E.g., • “OPS inspects, regulates and enforces interstate gas and hazardous liquid pipeline safety requirements in Indiana.” • “Through certification by OPS, the state of Indiana regulates, inspects, and enforces intrastate gas pipeline safety requirements.” • “By signed agreement with OPS, Indiana also inspects and regulates intrastate Hazardous Liquid pipeline safety requirements.” • Identify who is responsible for I&E in state. E.g., • “This work is performed by the Pipeline Safety Division of the Indiana Utility Regulatory Commission.”

34. State Regulatory Pages (Fact Sheets) • Link to where state regulations can be found. E.g., http://www.in.gov/iurc/2335.htm. • Link to summary of state enforcement actions. • Provide contact information pertaining to pipelines in state. E.g., • Indiana Utility Regulatory Commission • 101 West Washington Street, Suite 1500 E • Indianapolis, IN 46204 • Acting Director, Pipeline Safety Division: William Boyd • Office: 317-232-2717; Fax: 317-233-2410 • E-mail: wboyd@urc.on.gov • Provides contact information for appropriate PHMSA Region and HQ offices.

37. Role of States in Pipeline Safety • Links to NAPSR website

38. Link to State Website (if available) For example:

39. Other Stakeholder Communications Website Pages • Links to pages: • State Regulatory Fact Sheets (previously discussed) • NAPSR • Grants to States for One-Call and Damage Prevention

40. Grants to States for One-Call and Damage Prevention

41. Grants to States for One-Call and Damage Prevention

42. Grants to States for One-Call and Damage Prevention