On June 3, 2022, APGA joined other natural gas trade associations in filing a petition with the Federal Energy Regulatory Commission (FERC), requesting that FERC adopt a rule that would prohibit pipelines from aggregating bids of non-contiguous segments of pipeline capacity. APGA joined with the Natural Gas Supply Association (NGSA), American Gas Association (AGA), and Process Gas Consumers Group (PGC) to make this request of FERC.
In the petition, APGA and the other organizations, which represent industrial users, shippers on natural gas pipelines and local gas utilities, explained that the pipeline practice of packaging high-value pipeline capacity with non-contiguous, unrelated parcels of unwanted low- or no-value capacity forces shippers to bid an artificially inflated price and enables a pipeline to collect revenue that exceeds the approved maximum tariff rates for the high-value capacity. While not all APGA members have been impacted by this practice, several have been including the Municipal Gas Authority of Georgia (MGAG), which provided an affidavit to support the petition. The practice has also seen increased use over the past couple of years.
FERC published the petition for comment earlier this summer, which received feedback from stakeholders both in support and opposition of the petition. APGA and the joint petitioners filed reply comments on September 6 to rebut arguments put forward asserting that such a rule was unnecessary. The next step is for FERC to act on the petition, which has no set timeframe.
A copy of the reply comments is available
here.
For questions on this article, please contact Renée Lani of APGA staff by phone at 202-464-0836 or by email at
rlani@apga.org.