AGA Says FERC Is Overstepping Its Role

Washington, D.C. – The American Gas Association (AGA) filed a Request for Rehearing and Clarification with the Federal Energy Regulatory Commission (FERC) regarding its Updated Policy Statement on Certification and New Interstate Natural Gas Facilities (Docket No. PL18-1-000) and Consideration of Greenhouse Gas Emissions in Natural Gas Infrastructure Reviews Interim Policy Statement (Docket No. PL21-3-000) (collectively, 2022 Policy Statements) stating the following:

“The 2022 Policy Statements are an unlawful expansion of the Commission’s role and responsibilities under the Natural Gas Act (NGA) and, left unmodified, will actively discourage the development of pipeline infrastructure, reduce reliability, raise consumer costs, and create deep uncertainty that will destabilize the competitive markets previously supported by the Commission’s regulations and policies, in contravention of the ‘public interest’ standard Congress enacted in the NGA.”

FERC’s Interim Policy Statement in Docket No. PL21-3-000, “Consideration of Greenhouse Gas (GHG) Emissions in Natural Gas Infrastructure Project Reviews,” sets a GHG threshold for when a project would have a significant impact on climate change. FERC will review utility and customers gas usage, something regulated at the state level, and could impose mitigation measures related to the end use of natural gas. FERC’s actions are creating great uncertainty surrounding its review of proposed projects and the scope of FERC’s oversight and authority over natural gas usage.

“The Commission should recognize that natural gas and current and future pipeline infrastructure can be consistent with reducing greenhouse gas emissions and a decarbonized energy future,” AGA states in its filing. “Millions of homes and businesses are connected to the U.S. natural gas delivery system and new customers continue to connect—on average, at a rate of more than one customer per minute. Despite this growth, during the past twenty years of reliable customer services, carbon dioxide emissions from the residential, commercial, and industrial natural gas sectors are virtually unchanged. Typical unit-level emissions are on a steady decline as a direct result of energy efficiency improvements, including tighter building envelopes, more efficient appliances and equipment, behavioral changes in energy consumption, and the effectiveness of natural gas utility efficiency programs. Moreover, many new gas customers are switching from more greenhouse gas intensive fuels such as oil, which actually represents an overall decline in net greenhouse gas emissions.”

AGA has released a bold vision for the future along with a seminal analysis detailing how America’s natural gas, natural gas utilities and delivery infrastructure will be essential to meeting our nation’s greenhouse gas emissions reduction goals, including achieving net-zero emissions.

In the updated certificate policy statement in Docket No. PL18-1-000 “Certification of New Interstate Natural Gas Facilities” FERC will no longer view agreements entered into by utilities for capacity required to serve existing or new customers or for reliability and resilience purposes as sufficient evidence of need. FERC will also seek information about the intended end use of gas, which is regulated by state commissions, during the federal application process. This could create uncertainty if FERC second guesses determinations made by utilities and state commissions as to what is needed to serve retail customers or maintain the reliability of the gas system.