The Commission’s recent order upholds the Form No. 501-G filing requirement, which was designed to determine whether pipelines are over-recovering on their cost of service in light of recent federal income tax rate and policy changes. Thus far, the Commission has initiated investigations into the rates of six pipelines pursuant to its authority under section 5 of the Natural Gas Act. These proceedings are ongoing.
On April 18, 2019, the Federal Energy Regulatory Commission (“FERC” or “the Commission”) issued an order (“Order No. 849-A”)1 denying requests for rehearing of its final rule on federal income tax rates for jurisdictional natural gas pipelines (“Order No. 849”).2 Order No. 849 adopted procedures for determining whether pipelines may be collecting unjust and unreasonable rates in light of income tax reductions established by the Tax Cuts and Jobs Act and the Commission’s revised tax allowance policy following the United Airlines, Inc. v. FERC decision.3 These procedures included a requirement that certain interstate natural gas pipelines file a FERC Form No. 501-G to estimate cost of service reductions and changes in returns on equity (“ROE”) resulting from the income tax changes. Continue reading “FERC Reaffirms Its Final Rule on Rate Changes Relating to Federal Income Tax Rates for Natural Gas Pipelines”
According to FERC Chairman Chatterjee, the electric transmission incentives NOI and a concurrently released NOI on the Commission’s ROE policy “will be critical to ensuring that the energy revolution we’re currently undergoing results in more reliable services and lower prices for customers.” The electric transmission incentives NOI “asks very important questions about whether the Commission should be focused on incentivizing projects with risks and challenges or thinking more broadly about the reliability and economic benefits that transmission projects can provide.” Comments are due 90 days, and reply comments are due 120 days, after publication in the Federal Register.
On March 21, 2019, the Federal Energy Regulatory Commission (“FERC” or “the Commission”) issued a Notice of Inquiry Regarding the Commission’s Electric Transmission Incentives Policy (the “NOI”) in Docket No. PL19-3-000.1 The NOI seeks comments on the scope and implementation of the Commission’s transmission incentives policy, citing numerous developments in transmission planning and development in the 13 years since FERC first promulgated its electric transmission incentives regulations and the seven years since FERC issued its last policy statement on the topic.
FERC is conducting a comprehensive review of its method for determining the appropriate return on equity in jurisdictional rates across the energy industry. Comments are due no later than 90 days, and reply comments no later than 120 days, after the publication of the NOI in the Federal Register.
Section 305 of the Federal Power Act (“FPA”)1 generally requires prior approval from the Federal Energy Regulatory Commission (“FERC” or “the Commission”) before an individual may serve as an officer or director of: (1) more than one public utility; (2) a public utility and certain entities authorized by law to underwrite or participate in the marketing of public utility securities; or (3) a public utility and a company that supplies electrical equipment to that public utility.
On February 21, 2019, the Federal Energy Regulatory Commission (“FERC” or “Commission”) issued a final rule implementing statutory amendments to section 203(a)(1)(B) of the Federal Power Act (“FPA”) (“Order No. 855”).1 Order No. 855 revises Part 33 of FERC’s regulations to establish a $10 million threshold for mergers and consolidations requiring FERC review and approval. The Commission is also implementing a notification requirement for merger and consolidation transactions that do not require Commission approval under the newly-amended regulations but that involve the acquisition of facilities valued over one million dollars. The amended regulations take effect on March 28, 2019. Continue reading “FERC Adopts Regulations Implementing $10 Million Threshold for Review of Public Utility Mergers and Consolidations”
On February 21, 2019, the Federal Energy Regulatory Commission (“FERC” or “the Commission”) issued an order authorizing Venture Global Calcasieu Pass, LLC (“Calcasieu Pass”) to site, construct, and operate a new liquefied natural gas (“LNG”) terminal and associated facilities (the “Export Terminal”) pursuant to section 3 of the Natural Gas Act (“NGA”).1 The Certificate Order also authorized TransCameron Pipeline, LLC (“TransCameron”) to construct and operate a new interstate pipeline under NGA section 7. Although the Certificate Order drew favorable conclusions in its environmental review of the projects, a concurrence by Commissioner LaFleur and a dissent by Commissioner Glick signaled growing dissatisfaction among half of the current Commission with respect to FERC’s practice of evaluating a project’s greenhouse gas (“GHG”) emissions.
On February 21, 2019, the Federal Energy Regulatory Commission issued an order (“Order No. 845-A”) granting in part and denying in part requests for rehearing and clarification of its final rule reforming the large generator interconnection procedures (“Order No. 845”). Order No. 845 aimed to “improve certainty for interconnection customers, promote more informed interconnections decisions, and enhance the interconnection process” by implementing various revisions to the Commission’s pro forma Large Generator Interconnection Procedures (“LGIP”) and pro forma Large Generator Interconnection Agreements (“LGIA”), including:
Option to Build: Removing the limitation that previously allowed interconnection customers to exercise the option to build transmission provider’s interconnection facilities and standalone network upgrades only in instances where the transmission provider could not meet the interconnection customer’s preferred construction timeline;
The ingenuity of the renewable energy industry and the energy-oriented financial players is never to be doubted. Within the past few years, several creative financial tools have emerged to support the development of new wind and solar projects as well as further advances in large-building energy efficiency. The traditional regulatory and financial incentives for renewable energy and energy efficiency projects—investment tax credits, production tax credits, mandated renewable portfolio standards, mandated energy efficiency targets—remain in place (at least for now). However, there is a new incentive at play, one which until recently the industry has not tried to monetize. The new incentive is the desire, indeed the perceived need, of certain companies to “go green,” to demonstrate a commitment to improving the climate in the face of growing public concerns about climate change. Companies that produce consumer products—beer, bread, computers, pharmaceuticals, etc.—and companies that provide services—telecommunications, online shopping, search engines—have concluded that there is ascertainable value to putting words like “100% Renewable Energy” on bags, cans, and packaging; on social media advertising; and on bricks and mortar. Building owners perceive ascertainable value in labeling their buildings as “green” buildings. What the creative minds of the energy and financial industry players have done is develop vehicles to capture and quantify those values, and put them to use.
Right now, cases involving climate change are being heavily litigated in courts across the United States. Hundreds of climate change-related cases have been filed in both federal and state courts, where parties are challenging governments’ and industry’s knowledge of and contribution to climate change. In the abstract, one would think that litigation involving emissions of greenhouse gases (“GHG”) linked to climate change would largely focus on the federal Clean Air Act. Yet, climate change-related cases now involve ever-expanding causes of action, including not only claims under the federal Clean Air Act and other federal statutes, but claims under the U.S. Constitution, state law claims, and common law claims.
There are several active cases that may have major implications on the government’s role in determining the direction of climate change policy, and on private companies’ past and future liability for alleged contributions to climate change, as well as knowledge of climate change impacts on business decision-making. This article discusses notable current cases involving climate change. Continue reading “Charting Climate Change Cases: A Survey of Recent Litigation”
The Republican majority of the Federal Energy Regulatory Commission (“FERC” or “Commission”) has drawn a clear distinction with how and when the Commission will analyze upstream and downstream greenhouse gas (“GHG”) emissions when reviewing natural gas pipeline projects. But with the recent announced resignation by Republican Commissioner Robert Powelson, a pending Notice of Inquiry issued by the Commission, a separate advanced Notice of Proposed Rulemaking issued by the Council on Environmental Quality (“CEQ”), and a recent petition to the D.C. Circuit Court, this current established protocol may not last and by this time next year we may see a whole new approach to pipeline GHG analysis coming out of FERC. Continue reading “Pipeline Update: Here Today, Gone Tomorrow? FERC’s Natural Gas Pipeline Greenhouse Gas Analysis Policy”