On July 18, the Federal Energy Regulatory Commission (“FERC”) issued a final rule that will create a new, streamlined rate filing and approval process for certain natural gas pipelines, including section 311 and Hinshaw pipelines.1 Under FERC’s modified regulations, section 311 and Hinshaw pipelines can elect to make rate filings through “optional notice procedures,” under which the rate filing will be automatically approved, without FERC order, if no protests are filed against it. Section 311 and Hinshaw pipelines should benefit from the optional notice procedures because they allow for quicker and more reliable approval of uncontroversial rate filings.
Under the optional notice procedures, protests must be submitted within 60 days of the pipeline’s initial filing (though FERC may establish another deadline of its choosing). If no protests are submitted in this time, the filing is approved. If protests are submitted, and the parties reach no resolution during a 30 day settlement period, FERC will initiate a proceeding to resolve the issues. The optional notice procedures also establish a deadline for interventions and initial comments of 21 days after the pipeline’s initial filing. While protests can be filed at any point up until the 60 day deadline, FERC’s aim is to get initial comments submitted within 21 days so that there is time to get disputed issues resolved and withdrawn before the 60 day deadline.
The new optional notice procedures are an alternative to the existing section 311 and Hinshaw rate filing process, under which rates are approved 150 days after filing unless FERC extends the time for action or initiates a proceeding. The optional notice process shares certain similarities with the prior notice certificate process that interstate pipelines are able to use to receive authority for certain projects. Section 311 and Hinshaw pipelines can also use the optional notice process for filing statements of operating conditions. The process, however, cannot be used for market-based rate filings by intrastate pipelines or blanket certificate applications by Hinshaw pipelines.
The new regulations also establish that rates approved under the optional notice procedures are subject to a review process every five years. Intrastate pipelines with unchanged state-approved rates can satisfy the five-year review process by submitting a certification that the state-approved rates continue to satisfy FERC’s regulatory requirements.