A House lawmaker on Tuesday withdrew an amendment seeking retroactive refund protection for natural gas customers, after energy leaders pledged to work out a compromise solution that possibly would bar interstate gas pipelines from intentionally drawing out regulatory proceedings in which they are accused of charging high transportation rates.

In the spirt of cooperation Rep. W.J. “Billy” Tauzin (R-LA), chairman of the House Energy and Commerce Committee, suggested that lawmakers “work out something” to ensure that the process for settling a claim by parties, who insist a pipeline’s rate should be lower, “is not delayed arbitrarily by the transporter in order to continue selling at the higher rate, if in fact the Commission believes a lower rate is equitable.”

He made this concession to Rep. Janice D. Schakowsky (D-IL), who proposed “identical refund” protections for gas consumers under the Natural Gas Act (NGA) that are awarded to electricity customers under the Federal Power Act (FPA). While the FPA allows electric customers to pursue retroactive refunds, the NGA does not provide this protection to gas customers.

Schakowsky pulled her proposal from consideration during committee mark-up of the House “Energy Policy Act of 2003,” after she was assured by Tauzin and Rep. Joe Barton (R-TX) that a compromise proposal addressing the issue would go to the House floor for a vote. “There will be something either in the bill that goes to the floor or a bipartisan amendment that is agreed to and allowed to be voted on the floor,” Barton said.

“Our word is our bond,” he told Schakowsky. Barton indicated he believed there was “some merit” to her proposal, and said a number of other Republicans “expressed sympathy” for it.

This is a “simple fairness issue for natural gas customers,” said Schakowsky, adding that gas customers should be able to collect refunds from the date a complaint is filed at the Federal Energy Regulatory Commission.

Tauzin objected to Schakowsky’s amendment because he believes it would create a platform for gas customers to routinely challenge pipeline rates that have already been approved by FERC. This “would inject uncertainty into the regulatory framework,” he said, adding that pipelines would be “greatly impaired” in the financial markets as a result, which would lead to higher rates for customers.

“The amendment ends up having the perverse effect of hurting [consumers]” in the end, Tauzin argued.

“We’re talking about exact parity with the [refund provisions in the] Federal Power Act,” said Schakowsky, who questioned why the refund protections in the FPA didn’t create market uncertainty.

Tauzin noted that FERC already has the power to require “bad actors” to disgorge profits that are illegally gained in the gas market.

While that kind of protection is critical, Rep. Ed Markey (D-MA) said he and Schakowsky were seeking refund authority for the “plain, garden-variety overcharges” incurred by gas customers.

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