Concurring and dissenting statements issued with the Federal Energy Regulatory Commission’s (FERC’s) February 21 order granting construction and operating authorization for a liquefied natural gas (LNG) export terminal highlight the increased scrutiny that gas construction projects are receiving concerning their potential effects on climate change.
FERC, CFTC, and State Energy Law Developments
The US Energy Information Administration (EIA) updated its website on January 7 to report that, once all its data is finalized, natural gas prices, production, consumption, and exports will reflect record increases in 2018.
The US Government Accountability Office (GAO) issued a report on December 18, 2018, identifying significant weaknesses in the Department of Homeland Security’s (DHS) Transportation Security Administration’s (TSA) Pipeline Security Program management and recommending improvements to address those weaknesses.
The Federal Energy Regulatory Commission (FERC or the Commission) Office of Enforcement (OE) issued its 2018 Report on Enforcement on November 15. The report provides a review of OE’s activities during fiscal year 2018 (FY 2018), which begins October 1 and ends September 30 annually.
The August 2018 enactment of the Foreign Investment Risk Review Modernization Act (FIRRMA) came after more than two years of debate over the appropriate scope of jurisdiction for the Committee on Foreign Investment in the United States (CFIUS).
The Federal Energy Regulatory Commission (FERC) and the US Department of Transportation’s (DOT’s) Pipeline and Hazardous Materials Safety Administration (PHMSA) released a Memorandum of Understanding (MOU) on August 31 to improve coordination throughout the Liquefied Natural Gas (LNG) permit application process for FERC-jurisdictional LNG facilities.
On August 1, the Federal Energy Regulatory Commission (FERC or the Commission) issued a notice establishing the dates by which certain jurisdictional natural gas pipeline companies must file FERC Form No. 501-G, the “one-time” informational filing the Commission plans to review to ascertain whether the pipelines have, in light of the Tax Cuts and Jobs Act, accounted for reduced federal corporate income taxes in their cost-of-service rates (one-time report).
On July 25, the Department of Energy (DOE) issued a final rule, effective August 24, to provide expedited authorization of applications to export liquefied natural gas (LNG) to non–Free Trade Agreement (FTA) countries (i.e., those countries with which the United States has not entered into an FTA) using “small-scale” natural gas export facilities.
The Federal Energy Regulatory Commission recently issued two orders intended to alleviate concerns that jurisdictional natural gas pipelines may be over-recovering cost-of-service rates due to (1) a reduction of the federal corporate income tax rate from 35% to 21% under the Tax Cuts and Jobs Act and (2) the DC Circuit Court of Appeals’ decision in United Airlines Inc. v. FERC, which found that FERC’s existing income tax allowance policy, when applied to pass-through entities such as master limited partnerships, creates a possibility of double recovery for income tax allowances under cost-of-service rates.
In response to concerns raised by authorization holders, potential liquefied natural gas (LNG) importers, and companies financing LNG export projects, the US Department of Energy’s Office of Fossil Energy (DOE/FE) issued a policy statement affirming its commitment to the non–free trade agreement (FTA) export authorizations it has granted and any export authorizations it grants in the future.