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FERC's Breathitt Proposes Limited NOPR

FERC's Breathitt Proposes Limited NOPR

Instead of trying to sift through all the issues relating to the short-term and long-term transportation markets, Commissioner Linda Breathitt proposed that FERC first issue a limited rulemaking addressing the less-controversial issues and save the more complex issues for later. "From what I've read in the comments [filed at FERC], the approach I am proposing appears to be one that many in the market could support," she said in a speech to the American Gas Association Legal Forum in La Jolla, CA, last week.

"Overall, I believe that one reasonable approach would be to issue a final rule which promotes term-differentiated and seasonal rates. The rule could signal an increased willingness on the Commission's part to allow new services which provide flexibility needed to respond to the changing pace and the changing faces in the natural gas marketplace. The rule could also implement changes to enhance transparency and address the penalty issue. While this may appear to some as merely a small step, I would disagree," Breathitt noted.

She doesn't believe the contentious proposals for daily auctioning and negotiation of terms and conditions of pipeline service should be included in the limited rulemaking. While "I continue to believe that they [daily auctions] are a fundamentally sound concept for the mitigation of market power," Breathitt said she thinks the industry needs "more experience with longer term capacity auctions before a daily auction would be viable."

With respect to negotiated terms and conditions, she noted that while she believes FERC should "encourage and promote" pipes to provide flexible services, "I would prefer that the flexibility be implemented through generally available rate schedules that permit other shippers who are similarly situated to avail themselves of developing services."

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ISSN © 2577-9877 | ISSN © 1532-1231
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