FERC Sends ADR Report to Justice Department
FERC approval of a settlement ending a two-year complex contract
dispute between Phelps Dodge Corp. and El Paso Natural Gas is the
most "recent success story" of the use of alternative dispute
resolution (ADR) methods at the Commission.
FERC cited the Phelps Dodge-El Paso case in a report submitted
to the Department of Justice (DOJ) last week as an example of the
progress it has made in using ADR as a tool to resolve difficult
cases. The staff report was prepared by the Commission's Dispute
Resolution Service (DRS) in response to President Clinton's May
1998 initiative encouraging agency use of ADR procedures.
".....[It] became clear that this case was going to head to
litigation. It was going to be a very difficult one," Hoecker said
at the Dec. 15 Commission meeting, during which the settlement was
approved. In a complaint filed in late 1997, Phelps Dodge accused
El Paso of violating a 1995 rate agreement by refusing to add
delivery points to service its mining facility in El Paso, TX.
A mediator from FERC's DRS, who convened the two sides in
September, helped to quickly resolve the contentious issue. After a
one-day session, "an agreement was reached and potential hearings
were avoided. Appellate review of the Commission orders was also
avoided. The settlement [further] resolved another contested
proceeding pending before the Commission that had been the subject
of numerous protests," the report said.
"The business interests of the parties were met without having
to determine which [had] the best position," Hoecker said. The use
of the ADR procedures in this contentious case, which were
voluntary, "saved the parties and the Commission a lot of time and
Hoecker believes that all companies involved in disputes at the
Commission should consider ADR as an option. "There's nothing too
technically difficult that we can't use ADR." He urged interested
parties to either call the toll-free number of 1-800-FERC-ADR or
send an e-mail at ferc.ADR@ferc.fed.us.
The Commission reported the DRS was established during this past
year to foster the increased use of ADR procedures. "The DRS is
independent and neutral. [It] is not involved in the decisional
processes, does not advocate positions, and does not conduct
investigations," the Commission told the DOJ.
"As part of its goal to expand ADR knowledge throughout the
Commission, the DRS plans to invite Commission employees from other
offices to apply for a one-year detail to the DRS," the report
said. While there, "the employees will receive specialized
education and training in ADR theory and practice as well as gain
firsthand experience in the practical application of ADR. At the
end of the one-year detail, the employees will return to the
program offices to apply ADR when appropriate." Moreover, the DRS
office also will consider offering internships to students pursuing
graduate degrees in ADR and mediation, according to the report.
©Copyright 1999 Intelligence Press, Inc. All rights
reserved. The preceding news report may not be republished or
redistributed in whole or in part without prior written consent of
Intelligence Press, Inc.