---
kind: "section"
citation: "15 U.S.C. § 3363"
title: "15"
title_heading: "Commerce and Trade"
number: "3363"
heading: "Emergency allocation authority"
release: "119-102"
url: "https://uscodex.org/usc/15/3363"
units:
  - "Chapter 60 — Natural Gas Policy"
  - "Subchapter III — Additional Authorities and Requirements"
  - "Part A — Emergency Authority"
---

# §3363. Emergency allocation authority

- (a) **In general—** In [order](/usc/15/8702.md?p=14) to assist in meeting [natural gas](/usc/15/3301.md?p=1) requirements for [high-priority uses](#k) of [natural gas](/usc/15/3301.md?p=1) during any [natural gas](/usc/15/3301.md?p=1) supply emergency declared under [section 3361 of this title](/usc/15/3361.md), the President may, by [order](/usc/15/8702.md?p=14), allocate supplies of [natural gas](/usc/15/3301.md?p=1) under subsections [(b)](#b), [(c)](#c), and [(d)](#d) to—
  - (1) any [interstate pipeline](/usc/15/3301.md?p=15);
  - (2) any [local distribution company](/usc/15/3301.md?p=17)—
    - (A) which is served by any [interstate pipeline](/usc/15/3301.md?p=15);
    - (B) which is providing [natural gas](/usc/15/3301.md?p=1) only for [high-priority uses](#k); and
    - (C) which is in need of deliveries of [natural gas](/usc/15/3301.md?p=1) to assist in meeting [natural gas](/usc/15/3301.md?p=1) requirements for [high-priority uses](#k) of [natural gas](/usc/15/3301.md?p=1); and
  - (3) any [person](/usc/15/3301.md?p=26) for meeting requirements of [high-priority uses](#k) of [natural gas](/usc/15/3301.md?p=1).
- (b) **Allocation of certain boiler fuel gas—**
  - (1) **Required finding—** The President shall not allocate supplies of [natural gas](/usc/15/3301.md?p=1) under this subsection unless he finds that—
    - (A) to the maximum extent practicable, emergency [purchase](/usc/15/78c–5.md?p=g) [authority](/usc/15/3051.md?p=1) under [section 3362 of this title](/usc/15/3362.md) has been utilized to assist in meeting [natural gas](/usc/15/3301.md?p=1) requirements for [high-priority uses](#k) of [natural gas](/usc/15/3301.md?p=1);
    - (B) emergency [purchases](/usc/15/78c–5.md?p=g) of [natural gas](/usc/15/3301.md?p=1) supplies under [section 3362 of this title](/usc/15/3362.md) are not likely to satisfy the [natural gas](/usc/15/3301.md?p=1) requirements for such [high-priority uses](#k);
    - (C) the exercise of [authority](/usc/15/3051.md?p=1) under this subsection is reasonably necessary to assist in meeting [natural gas](/usc/15/3301.md?p=1) requirements for such [high-priority uses](#k); and
    - (D) any [interstate pipeline](/usc/15/3301.md?p=15) or [local distribution company](/usc/15/3301.md?p=17) receiving such [natural gas](/usc/15/3301.md?p=1) has ordered the termination of all deliveries of [natural gas](/usc/15/3301.md?p=1) for other than [high-priority uses](#k) and attempted to to[^1] the maximum extent practicable to terminate such deliveries.
  - (2) **Allocation authority—** Subject to [paragraph (1)](#b-1), in [order](/usc/15/8702.md?p=14) to assist in meeting [natural gas](/usc/15/3301.md?p=1) requirements for [high-priority uses](#k) of [natural gas](/usc/15/3301.md?p=1), the President may, by [order](/usc/15/8702.md?p=14), allocate supplies of [natural gas](/usc/15/3301.md?p=1) the use of which has been prohibited by the President pursuant to [authority](/usc/15/3051.md?p=1) under [section 717z of this title](/usc/15/717z.md) (relating to the use of [natural gas](/usc/15/3301.md?p=1) as a boiler fuel during any [natural gas](/usc/15/3301.md?p=1) supply emergency).
- (c) **Allocation of general pipeline supply—**
  - (1) **Required findings—** The President shall not allocate supplies of [natural gas](/usc/15/3301.md?p=1) under this subsection unless he finds that—
    - (A) to the maximum extent practicable, allocation of supplies of [natural gas](/usc/15/3301.md?p=1) under [subsection (b)](#b) has been utilized to assist in meeting [natural gas](/usc/15/3301.md?p=1) requirements for [high-priority uses](#k) of [natural gas](/usc/15/3301.md?p=1);
    - (B) the exercise of such [authority](/usc/15/3051.md?p=1) is not likely to satisfy the [natural gas](/usc/15/3301.md?p=1) requirements for such [high-priority uses](#k);
    - (C) the exercise of [authority](/usc/15/3051.md?p=1) under this subsection is reasonably necessary to assist in meeting [natural gas](/usc/15/3301.md?p=1) requirements for such [high-priority uses](#k);
    - (D) any [interstate pipeline](/usc/15/3301.md?p=15) or [local distribution company](/usc/15/3301.md?p=17) receiving such [natural gas](/usc/15/3301.md?p=1) has ordered the termination of all deliveries of [natural gas](/usc/15/3301.md?p=1) for other than [high-priority uses](#k) and attempted to the maximum extent practicable to terminate such deliveries;
    - (E) such allocation will not create, for the [interstate pipeline](/usc/15/3301.md?p=15) delivering [certificated natural gas](/usc/15/3301.md?p=19), a supply shortage which will cause such pipeline to be unable to meet the [natural gas](/usc/15/3301.md?p=1) requirements for [high-priority uses](#k) of [natural gas](/usc/15/3301.md?p=1) served, directly or indirectly, by such pipeline; and
    - (F) such allocation will not result in a disproportionate share of deliveries and resulting curtailments of [natural gas](/usc/15/3301.md?p=1) being experienced by such [interstate pipeline](/usc/15/3301.md?p=15) when compared to deliveries and resulting curtailments which are experienced as a result of [orders](/usc/15/8702.md?p=14) issued under this subsection applicable to other [interstate pipelines](/usc/15/3301.md?p=15) (as determined by the President).
  - (2) **Required notification from State—**
    - (A) **[^2] Notification—** The President shall not allocate supplies of [natural gas](/usc/15/3301.md?p=1) under this subsection unless he is notified by the Governor of any [State](/usc/15/3301.md?p=34) that—
      - (i) a shortage of [natural gas](/usc/15/3301.md?p=1) supplies available to such [State](/usc/15/3301.md?p=34) exists or is imminent;
      - (ii) such shortage or imminent shortage endangers the supply of [natural gas](/usc/15/3301.md?p=1) for [high-priority uses](#k) in such [State](/usc/15/3301.md?p=34); and
      - (iii) the exercise of [authority](/usc/15/3051.md?p=1) under [State](/usc/15/3301.md?p=34) law is inadequate to protect [high-priority uses](#k) of [natural gas](/usc/15/3301.md?p=1) in such [State](/usc/15/3301.md?p=34) from an interruption in [natural gas](/usc/15/3301.md?p=1) supplies.
  - (3) **Basis of finding—** To the maximum extent practicable, the Governor shall submit, together with any notification under subparagraph (A), information upon which he has based his finding under such subparagraph, including—
    - (i) volumes of [natural gas](/usc/15/3301.md?p=1) required to meet the [natural gas](/usc/15/3301.md?p=1) requirements for [high-priority uses](#k) of [natural gas](/usc/15/3301.md?p=1) in such [State](/usc/15/3301.md?p=34);
    - (ii) information received from [persons](/usc/15/3301.md?p=26) in the business of producing, selling, transporting, or delivering [natural gas](/usc/15/3301.md?p=1) in such [State](/usc/15/3301.md?p=34) as to the volumes of [natural gas](/usc/15/3301.md?p=1) supplies available to such [State](/usc/15/3301.md?p=34);
    - (iii) information on the [authority](/usc/15/3051.md?p=1) under [State](/usc/15/3301.md?p=34) law which will be exercised to protect [high-priority uses](#k); and
    - (iv) such other information which the President requests or which the Governor determines appropriate to apprise the President of emergency deliveries and transportation of interstate [natural gas](/usc/15/3301.md?p=1) needed by such [State](/usc/15/3301.md?p=34).
  - (4) **Allocation authority—** Subject to paragraphs [(1)](#c-1), [(2)](#c-2), and [(5)](#c-5), in [order](/usc/15/8702.md?p=14) to assist in meeting [natural gas](/usc/15/3301.md?p=1) requirements for [high-priority uses](#k) of [natural gas](/usc/15/3301.md?p=1), the President may, by [order](/usc/15/8702.md?p=14), allocate supplies of [certificated natural gas](/usc/15/3301.md?p=19) from any [interstate pipeline](/usc/15/3301.md?p=15).
  - (5) **Consideration of alternative fuel availability—** In issuing any [order](/usc/15/8702.md?p=14) under this subsection the President shall consider the relative availability of alternative fuel to [natural gas](/usc/15/3301.md?p=1) users supplied by the [interstate pipeline](/usc/15/3301.md?p=15) 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](/usc/15/3301.md?p=1) under this subsection unless he finds that—
    - (A) to the maximum extent practicable, allocation of supplies of [natural gas](/usc/15/3301.md?p=1) under [subsection (c)](#c) has been utilized to assist in meeting [natural gas](/usc/15/3301.md?p=1) requirements for [high-priority uses](#k) of [natural gas](/usc/15/3301.md?p=1);
    - (B) the exercise of such [authority](/usc/15/3051.md?p=1) is not likely to satisfy the [natural gas](/usc/15/3301.md?p=1) requirements for such [high-priority uses](#k);
    - (C) the exercise of [authority](/usc/15/3051.md?p=1) under this subsection is reasonably necessary to assist in meeting [natural gas](/usc/15/3301.md?p=1) requirements for such [high-priority uses](#k);
    - (D) any [interstate pipeline](/usc/15/3301.md?p=15) or [local distribution company](/usc/15/3301.md?p=17) receiving such [natural gas](/usc/15/3301.md?p=1) has ordered the termination of all deliveries of [natural gas](/usc/15/3301.md?p=1) for other than [high-priority uses](#k) and attempted to the maximum extent practicable to terminate such deliveries; and
    - (E) such allocation will not create, for the [person](/usc/15/3301.md?p=26) who owns and would otherwise use such [natural gas](/usc/15/3301.md?p=1), a supply shortage which will cause such [person](/usc/15/3301.md?p=26) to be unable to satisfy such [person](/usc/15/3301.md?p=26)’s [natural gas](/usc/15/3301.md?p=1) requirements for [high-priority uses](#k).
  - (2) **Allocation authority—** Subject to paragraphs [(1)](#d-1) and [(3)](#d-3), in [order](/usc/15/8702.md?p=14) to assist in meeting [natural gas](/usc/15/3301.md?p=1) requirements for [high-priority uses](#k) of [natural gas](/usc/15/3301.md?p=1), the President may, by [order](/usc/15/8702.md?p=14), allocate supplies of [natural gas](/usc/15/3301.md?p=1) which would be [certificated natural gas](/usc/15/3301.md?p=19) but for the second sentence of [section 3301(19) of this title](/usc/15/3301.md?p=19).
  - (3) **Consideration of economic feasibility of alternative fuels—** In issuing any [order](/usc/15/8702.md?p=14) under this subsection, the President shall consider the economic feasibility of alternative fuels available to the user which owned the [natural gas](/usc/15/3301.md?p=1) subject to an [order](/usc/15/8702.md?p=14) under this subsection.
- (e) **Limitation—** No [order](/usc/15/8702.md?p=14) may be issued under this section unless the President determines that such [order](/usc/15/8702.md?p=14) will not require transportation of [natural gas](/usc/15/3301.md?p=1) by any pipeline in excess of its available transportation capacity.
- (f) **Industry assistance—** The President may request that representatives of pipelines, [local distribution companies](/usc/15/3301.md?p=17), and other [persons](/usc/15/3301.md?p=26) meet and provide assistance to the President in carrying out his [authority](/usc/15/3051.md?p=1) under this section.
- (g) **Compensation—**
  - (1) **In general—** If the parties to any [order](/usc/15/8702.md?p=14) issued under subsection [(b)](#b), [(c)](#c), [(d)](#d), or [(h)](#h) fail to agree upon the terms of compensation for [natural gas](/usc/15/3301.md?p=1) deliveries or transportation required pursuant to such [order](/usc/15/8702.md?p=14), the President, after a hearing held either before or after such [order](/usc/15/8702.md?p=14) takes effect, shall, by supplemental [order](/usc/15/8702.md?p=14), prescribe the amount of compensation to be paid for such deliveries or transportation and for any other expenses incurred in delivering or transporting [natural gas](/usc/15/3301.md?p=1).
  - (2) **Calculation of compensation for certain boiler fuel natural gas—** For purposes of any supplemental [order](/usc/15/8702.md?p=14) under [paragraph (1)](#g-1) with respect to emergency deliveries pursuant to [subsection (b)](#b), the President shall calculate the amount of compensation—
    - (A) for supplies of [natural gas](/usc/15/3301.md?p=1) based upon the amount required to make whole the user subject to the prohibition [order](/usc/15/8702.md?p=14), but in no event may such compensation exceed just compensation prescribed in [section 717z of this title](/usc/15/717z.md); and
    - (B) for transportation, storage, delivery, and other services, based upon reasonable costs, as determined by the President.
  - (3) **Compensation for other natural gas allocated—** For the purpose of any supplemental [order](/usc/15/8702.md?p=14) under [paragraph (1)](#g-1), if the party making emergency deliveries pursuant to subsection [(c)](#c) or [(d)](#d)—
    - (A) indicates a preference for compensation in kind, the President shall direct that compensation in kind be provided as expeditiously as practicable;
    - (B) indicates a preference for compensation, or the President determines that, notwithstanding paragraph (A) of this subsection, any portion thereof cannot practicably be compensated in kind, the President shall calculate the amount of compensation—
      - (i) for supplies of [natural gas](/usc/15/3301.md?p=1), based upon the amount required to make the pipeline and its [local distribution companies](/usc/15/3301.md?p=17) whole, in the case of any [order](/usc/15/8702.md?p=14) under [subsection (c)](#c), or to make the user from whom [natural gas](/usc/15/3301.md?p=1) is allocated whole, in the case of any [order](/usc/15/8702.md?p=14) under [subsection (d)](#d) including any amount actually paid by such pipeline and its [local distribution companies](/usc/15/3301.md?p=17) or such user for volumes of [natural gas](/usc/15/3301.md?p=1) or higher cost synthetic gas acquired to replace [natural gas](/usc/15/3301.md?p=1) subject to an [order](/usc/15/8702.md?p=14) under subsection [(c)](#c) or [(d)](#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](/usc/15/3301.md?p=15) under this subsection shall be credited to the [account](/usc/15/1681a.md?p=r-4) of any [local distribution company](/usc/15/3301.md?p=17) served by that pipeline to the extent ordered by the President to make such [local distribution company](/usc/15/3301.md?p=17) whole.
- (h) **Related transportation and facilities—** The President may, by [order](/usc/15/8702.md?p=14), require any pipeline to transport [natural gas](/usc/15/3301.md?p=1), and to construct and operate such facilities for the transportation of [natural gas](/usc/15/3301.md?p=1), as he determines necessary to carry out any [order](/usc/15/8702.md?p=14) under subsection [(b)](#b), [(c)](#c), or [(d)](#d). Compensation for the costs of any construction or transportation ordered under this subsection shall be determined under [subsection (g)](#g) and shall be paid by the [person](/usc/15/3301.md?p=26) to whom supplies of [natural gas](/usc/15/3301.md?p=1) are ordered allocated under this section.
- (i) **Monitoring—** In [order](/usc/15/8702.md?p=14) to effect the purposes of this part, the President shall monitor the operation of any [order](/usc/15/8702.md?p=14) made pursuant to this section to assure that [natural gas](/usc/15/3301.md?p=1) delivered pursuant to this section is applied to [high-priority uses](#k) only.
- (j) **Commission study—** Not later than June 1, 1979, the [Commission](/usc/15/3301.md?p=24) shall prepare and submit to the Congress a report regarding whether [authority](/usc/15/3051.md?p=1) to allocate [natural gas](/usc/15/3301.md?p=1), which is not otherwise subject to allocation under this part, is likely to be necessary to meet [high-priority uses](#k).
- (k) **“High-priority use” defined—** For purposes of this section, the term “high-priority use” means any—
  - (1) use of [natural gas](/usc/15/3301.md?p=1) in a residence;
  - (2) use of [natural gas](/usc/15/3301.md?p=1) in a commercial establishment in amounts less than 50 [Mcf](/usc/15/3301.md?p=29) on a peak day; or
  - (3) any use of [natural gas](/usc/15/3301.md?p=1) the curtailment of which the President determines would endanger life, health, or maintenance of physical property.

## Footnotes

[^1]: So in original.
[^2]: So in original. Par. (2) enacted without a subpar. (B).

## Source credit

(Pub. L. 95–621, title III, § 303, Nov. 9, 1978, 92 Stat. 3383.)