In response to the Eneigy Policy Act of 1992, (Pub. L. No. 102-486,106 Stat. 2776), FERC promulgates Order No. 561 designed to satisfy the Act's mandate to establish a "simplified and generally applicable ratemaking methodology for oil pipelines." Order No. 561 uses an "indexing system" based on the calculation of an "initial rate" from which increases may be made under the just and reasonable standard. The "initial rate" is subject to annual maximum increases based on FERC's calculated inflation index for the prior year. In 2005, Markwest files proposed rates for its oil pipeline tariffs with FERC. Several shippers protest, leading to a three-year settlement period during which the maximum rates are set by the agreement.
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