Washington, D.C. – The American Gas Association (AGA) today praised the Federal Energy Regulatory Commission’s (FERC) new proceeding in which to consider comments, calling it a necessary step to elevate the discussion surrounding gas-electric integration issues. Last week, FERC opened Docket No. AD12-12-000 to receive comments on issues regarding coordination between natural gas and electricity markets. The notice followed a request for comments issued by FERC Commissioner Philip D. Moeller seeking input on a variety of questions on how best to address the reliability impacts associated with increased use of natural gas to generate electricity.
“Maintaining the reliability of both the natural gas and electric systems is a national priority. As those systems become increasingly interdependent, policy direction and industry leadership are needed to ensure reliability for all natural gas and electric system customers,” said Dave McCurdy, president and CEO of AGA. “The Federal Energy Regulatory Commission serves an important leadership role in this area. We encourage FERC to use this new proceeding to engage stakeholders across both natural gas and electric industries in a national dialogue on policies and actions needed to enhance reliability.”
In July 2011, McCurdy addressed the National Association of Regulatory Utility Commissioners (NARUC) about the increased interdependence between the electric and natural gas systems saying, “Better coordination between the natural gas and electric systems will be needed to ensure the reliability of both systems.”
FERC Commissioner Cheryl A. LaFleur expressed the hope that diverse industry participants will provide a wide range of comments on these issues, saying, “The electric industry’s increased reliance on natural gas has greatly heightened the need to address how these markets and operating networks can better work together.”
Also last week, FERC issued a proposed rule that would amend its regulations to incorporate by reference, with certain exceptions, the latest version of business practice standards adopted by the Wholesale Gas Quadrant of the North American Energy Standards Board (NAESB) applicable to natural gas pipelines. These are known as Version 2.0 Standards. FERC believed that the proposal would benefit the wholesale gas market by updating and improving standards for business practices of interstate natural gas pipelines.
FERC Commissioner John R. Norris said, “While a good work product, these standards are just a small part of a broader set of issues that need to be addressed to ensure adequate coordination and harmonization between the natural gas and electricity industries.”
“In the end,” says McCurdy, “the ability of our natural gas utilities to meet the needs of the 65 million residential, commercial and industrial customers they serve must be preserved.”