FERC Generally Denies Rehearing but Clarifies Some Limited Nuances in New Capacity Release Rules for Short-Term Deals and Addresses Transactions Handled by Asset Managers, States and LNG Terminals

摘要

FERC last week disposed of the bulk of the requests for rehearing of its Order No. 712 regulations (RM08-1) that permit market-based pricing for short-term capacity releases and facilitate asset management arrangements (AMAs) by relaxing the bidding requirements and a prohibition on tying.1 The Commission in the Final Rule (1) had concluded that in removing the price ceiling from short-term capacity releases it was departing from a cost-of-service ratemaking methodology, but determined that given the benefits to be derived from removing the ceiling sufficient protections existed against the exercise of market power by releasing shippers; (2) had clarified that the tying prohibition does not apply to conditions associated with gas inventory held in storage for releases of firm storage capacity; and (3) had waived its bidding requirements and prohibition on tying for releases made as part of state-approved open access programs. The Commission determined not to remove the price ceiling for pipeline short-term services.