FERC Expected to Address Competing Pipeline Projects
Faced with an onslaught of new pipeline projects, FERC this week
is expected to propose a policy statement that some say will
establish a "framework" to help the Commission select a winner when
two or more projects are destined for the same market [PL99-3]. The
Commission has listed discussion of a policy statement on pipeline
construction certificates on the agenda for its regular open
"It's clear the Commission is in a box so to speak. It's got to
start to make decisions amongst competing projects" in the
Northeast, Midwest and Florida markets, said one FERC observer. "I
think previously.....the Commission was hoping, for instance with
respect to the Independence and Millennium pipeline projects, that
at some point there would appear to be a clear winner based on
contract demand.....But that hasn't happened. It looks like FERC is
going to eventually have to make a decision on these competing
projects," he noted.
The observer expects FERC to possibly revisit the Ashbacker
Doctrine, which requires a winner to be selected when there are two
or more competing pipeline projects headed for the same market.
"Probably what I suspect they're going to be doing is asking
parties how do you make the selection. Do you do it on least cost?"
That approach would almost always favor incumbent pipelines over
new entrants to the market, thus "excluding any possibility of
competition," he said. The policy statement will be "very
important" for pipelines because "it will determine the degree to
which new entrants will have an opportunity to build new grassroots
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