Orders on negotiated rates are troublina

✍ Scribed by Smead, Richard G.

• Publisher: John Wiley and Sons
• Year: 2007
• Weight: 362 KB
• Volume: 15
• Category: Article
• ISSN: 0743-5665
• DOI: 10.1002/gas.3410151007

✦ Synopsis

Orders on Negotiated Rates Are Troublina

very so often, the Federal Energy Regula-E tory Commission does something that leaves many of us wondering, "Just what could they have been thinking?" A recent example is a series of orders that have cast new, and perhaps unnecessary, doubt on the definition of a "negotiated rate," as compared with a normal discounted rate pursuant to a pipeline's tariff. In a February order in a Natural Gas Pipeline Company case, the commission furthered an evolution of its thinking that had shown up in an earlier Natural case and in a Tennessee Gas Pipeline Company case. Basically, taking all these orders together, it appears that a "negotiated rate" exists at any time the commission feels uncomfortable with the transaction. This can be true no matter how firmly the parties bind themselves to operating within the rate forms and levels contained within the pipeline's tariff.

. . . appears that a "negotiated rate" exists at any time the commission feels uncomfortable with the transaction.