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FERC Initiates Inquiry into Pipeline Certification Process

FERC on Thursday issued a notice of inquiry (NOI) that could lead to a revision of its policies regarding the review and authorization of interstate natural gas transportation facilities under section 7 of the Natural Gas Act.

The NOI was issued to examine Federal Energy Regulatory Commission policies in light of changes in the natural gas industry and increased stakeholder interest in how the Commission reviews natural gas pipeline proposals since it adopted its current policy statement on pipeline certification in September 1999, it said.

"Today's NOI poses a range of questions that reflect concerns raised in numerous public comments, court proceedings and other forums," FERC said. "Through the NOI, FERC is seeking input on potential changes to both the existing policy statement and the structure and scope of the Commission's environmental analysis of proposed natural gas projects."

The draft NOI approved by commissioners during their regular public meeting seeks input on whether, and if so how, FERC should adjust its: methodology for determining whether there is a need for proposed projects, including consideration of precedent agreements and contracts for service as evidence of such need; consideration of the potential exercise of eminent domain and of landowner interests related to proposed projects; and evaluation of the environmental impacts of proposed projects [PL18-1].

FERC is also seeking input on whether there are specific changes it could consider implementing to improve the efficiency and effectiveness of its certificate processes including pre-filing, post-filing and post-order issuance.

At his first meeting as chairman in December, Kevin McIntyre said FERC would review the decades-old policy that governs how the regulatory agency evaluates natural gas pipeline proposals.

"As I noted then, 1999 was some time ago, and...much has changed in the industry since that time," McIntyre said Thursday. "I believe that good governance calls for transparently considering whether policies currently in place remain effective, and to look for opportunities to make improvements, if any can be made, to help us ensure that we are reviewing pipeline applications today in the most sensible way, and if not, to take appropriate steps to address that...

"I emphasize that by issuing the NOI we are posing questions to stakeholders. The issuance of the NOI should neither be read as a forecast of a policy direction nor as an indication of any particular action the Commission may take. Further, the NOI and my remarks should not be read to suggest that I believe that the current policy statement or its application has been ineffective or that any changes are necessarily going to be made."

The Interstate Natural Gas Association of America (INGAA) said it looked forward to participating in the proceeding.

"It is understandable that FERC wishes to take a fresh look at its 1999 certificate policy statement," said INGAA CEO Don Santa. "Natural gas now plays a more prominent role in our energy economy and the public policy landscape surrounding energy and the environment has evolved considerably over the intervening years.

"The ability to expand and modify interstate natural gas pipelines under FERC's existing policy has served the nation well. This pipeline infrastructure has facilitated the world's most competitive natural gas commodity market and has enabled American consumers and industry to benefit from our natural gas abundance."

The Commission’s unanimous approval of the draft NOI came two days after House lawmakers and members of FERC discussed faster gas pipeline permitting and a more transparent process.

Comments on the NOI are due within 60 days of its publication in the Federal Register.

 

 

 

 

 

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