Regulatory reform critical under 636

✍ Scribed by Schneider, Jonathan D.

• Book ID: 102219266
• Publisher: John Wiley and Sons
• Year: 2008
• Weight: 423 KB
• Volume: 9
• Category: Article
• ISSN: 0743-5665
• DOI: 10.1002/gas.3410090907

✦ Synopsis

he attention devoted by the natural gas and its predecessor orders has all but eclipsed important questions over FERC's increasing dysfunction in handling traditional pipeline rate cases. The difficulties faced by the Commission in performing its role as the arbiter of just and reasonable rates are important, because some facsimile of traditional regulation is likely to be exercised over interstate pipeline transportation for the foreseeable future, and because a breakdown of the Commission's core regulatory function will undermine the competitive wellhead market that the Commission and Congress have gone to such great lengths to foster.

T industry to restructuring under Order 636

The attention devoted by the natural gas industry to restructuring under Order 636 and its predecessor orders has all but eclipsed important questions over FERC's increasing dysfunction in handiing traditional pipeline rate cases.

Simply stated, the Commission takes too long to decide rate cases under a statute that permits pipelines to place unilateral rate increases into effect before the Commission has addressed the merits of the cases. The Commission's substantive decisions on routine rate cases are often issued two to three years after the effective date of the rate increases. For the life of these delays, pipelines are entitled to charge rate increases that invariably are held to be in excess of a just and reasonable level, with