Academic journal article Energy Law Journal

Report of the Natural Gas Committee

Academic journal article Energy Law Journal

Report of the Natural Gas Committee

Article excerpt

This report summarizes policy developments and legal decisions that occurred at the Federal Energy Regulatory Commission (FERC or the Commission), the Pipeline and Hazardous Materials Safety Administration (PHMSA), and the United States Courts of Appeals in the area of natural gas regulation between July 1, 2016, and June 30, 2017.·

I. Rates, Terms, and Conditions of Service

A. Abandonments

1.UGI Storage Co. & UGI Central Penn Gas, Inc., 157 F.E.R.C. ¶ 61,078 (2016).

The FERC granted UGI Central Penn Gas, Inc. (Central Penn) permission and approval to abandon leased capacity on UGI Storage Company's (UGI Storage) system and granted UGI Storage a certificate to require the capacity.1 The FERC found that Central Penn no longer required the leased capacity to meet its gas supply needs.2 UGI Storage's reacquisition of the leased capacity required certificate authorization because, as FERC explained, "[t]he termination of the applicants' capacity lease agreement ends Central Penn's property interest in the leased capacity, thus UGI Storage requires certificate authorization to reacquire this capacity for use for service under its own tariff."3 The FERC approved the reacquisition of capacity finding that "[b]ecause UGI Storage provides its storage and wheeling services at market-based rates, the change in status of the 8,362 Dth/ d of capacity from leased capacity to system capacity would not affect the rates of any of its customers."4

2. High Point Gas Transmission, L.L.C., 159 F.E.R.C. ¶ 62,007 (2017).

The FERC authorized High Point Gas Transmission, L.L.C. (High Point) to abandon by sale its Venice to Toca (VTT) Pipeline to its affiliate Cayenne Pipeline, L.L.C. (Cayenne) for use as a natural gas liquids pipeline.5 According to High Point, the only firm shipper on the VTT line had agreed to terminate its firm transportation agreement prior to the abandonment.6 The FERC found that the proposed abandonment was permitted by "public convenience or necessity" since the "conversion of the VTT Pipeline [would] not result in any disruption to the continuity and stability of High Point's existing firm transportation service."7

3. Texas E. Transmission, L.P., 159 F.E.R.C. ¶ 62,179 (2017).

The FERC granted Texas Eastern Transmission, L.P. (Texas Eastern) authorization to abandon two 2,500 horsepower reciprocating compressor units and related appurtenances at its Longview Compressor Station.8 According to Texas Eastern, the units were no longer required to meet its firm service obligations and the associated equipment and parts from the units would be used in other compressor stations on the Texas Eastern system.9 The FERC granted the abandonment, finding that doing so would "allow Texas [E]astern to eliminate costly expenditures on operation and maintenance of equipment that [was] no longer required for transportation services."10

B. Capacity Release

1.Rover Pipeline L.L.C.; Panhandle E. Pipe Line Co., L.P.; Trunkline Gas Co., L.L.C., 158 F.E.R.C. ¶ 61,109 (2017).

The FERC approved an application to construct and operate over 510 miles of interstate pipeline submitted by Rover Pipeline L.L.C. (Rover).11 In approving the project, the Commission reviewed non-conforming provisions from several precedent agreements between Rover and certain shippers.12 One agreement contained capacity release terms in which Rover agreed to make short-term prearranged releases of capacity to the shipper on the Panhandle Eastern Pipe Line Company, L.P. and Trunkline Gas Co., L.L.C. systems.13 The Commission found the provision to be consistent with its capacity release regulations, as it placed no restrictions on the replacement shipper's rights.14 The Commission noted that the instant approval did not waive future review of the non-conforming provisions and required Rover to file executed copies of the agreements within thirty to sixty days before they become effective.15

2.Algonquin Gas Transmission, L. …

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