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Public Statements

Letter to the Chairman of the Federal Energy Regulatory Commission Jon Wellinghoff - Rate Procedings

Letter

By:
Date:
Location: Washington, DC

Senate Energy and Natural Resources Committee Chairman Ron Wyden, D-Ore., and Ranking Member Lisa Murkowski, R-Alaska, today sent a letter to the Federal Energy Regulatory Commission requesting information about rate proceedings the commission has initiated under section 5 of the Natural Gas Act since 2009.

The request is part of the Chairman and Ranking Member's shared commitment to protecting consumers; ensuring adequate, safe and reliable infrastructure; and providing strong oversight of energy markets and regulatory agencies.

"Consumers deserve to know how much they've been overcharged, and whether current regulations and regulators are doing the job," Wyden said.

The letter asks FERC to provide information about proceedings under section 5 of the Natural Gas Act, which concern "allegations that pipeline companies collected fees from pipeline customers for transportation, storage and fuel that were unjust and unreasonable."

"I think it's important to establish how the process FERC has in place to maintain just and reasonable rates is working," Murkowski said. "This information will help establish our understanding of the facts."

The letter is below.

The Honorable Jon Wellinghoff
Chairman
Federal Energy Regulatory Commission
888 First Street, NE
Washington, DC 20426

Dear Chairman Wellinghoff:

Since 2009, the Commission has initiated ten rate proceedings pursuant to section 5 of the Natural Gas Act (15 USC 717d(a)) to investigate whether rates charged by natural gas pipelines are just an reasonable. One additional section 5 complaint has been filed by outside parties n the past four years. These proceedings concerned allegations that pipeline companies collected fees from pipeline customers for transportation, storage, and fuel that were unjust and unreasonable.

In an effort to better understand the nature of these proceedings, we request that for each of the section 5 cases which have been resolved to date, please specify the original FERC-approved rate of return and note whether the pipeline companies offered any discounts for its services. Please also provide a brief description of and timeline for the section 5 proceeding and its resolution, whether by settlement or otherwise, including changes in rates for the various customer classes resulting from the proceeding, if any.

In 2008, the Commission revised its Form 2 which is filed annually by natural gas pipeline companies to provide FERC, pipeline customers, and the public with detailed information about the pipelines' costs and revenues. These changes appear to have helped FERC and pipeline customers to determine whether pipeline rates are just and reasonable. Please provide us information on the rules and procedures describing who may challenge pipeline rates, including the Commission and whether the FERC has the authority, under the Natural Gas Act or any other applicable law, to require pipelines to periodically show cause that their rates are just and reasonable.

Thank you for your prompt attention to this request.

Sincerely,

Ron Wyden Lisa Murkowski
Chairman Ranking Member


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