Santa: Interstate energy transmission debate should include gas

US lawmakers should consider correcting defects in current interstate gas pipeline regulations as they draft new interstate electricity transmission legislation, said the president of the INGAA on Feb. 23.

Feb 24th, 2009

Nick Snow
OGJ Washington Editor

WASHINGTON, DC, Feb. 24 -- US lawmakers should consider correcting defects in current interstate gas pipeline regulations as they draft new interstate electricity transmission legislation, said the president of the Interstate Natural Gas Association of America on Feb. 23.

"INGAA agrees that the statutory framework for siting interstate natural gas pipelines should be instructive as Congress considers a remedy for the inability to modernize and expand the electric transmission grid," INGAA Pres. Donald F. Santa Jr. said in a letter to US Senate Majority Leader Harry M. Reid (D-Nev.) and four congressional energy leaders.

He noted that the Natural Gas Act of 1938 gave the Federal Power Commission and its successor, the Federal Energy Regulatory Commission, preemptive authority to authorize new gas pipeline construction and rate certainty, once a pipeline is built, which helps gas pipeline companies raise billions of dollars in private capital for new gas transmission infrastructure.

"While the NGA provides a good model, even it is incomplete, however, as a comprehensive scheme for ensuring that energy infrastructure can be constructed on a timely basis to the needs of energy consumers," Santa said.

He said that despite FERC's well-established authority under the law, states and other federal agencies "retain the ability to delay, deny, or unreasonably condition other permits required under federal law. Therefore, even though FERC may authorize the construction of an interstate pipeline based on a finding that it meets 'the public convenience and necessity,' an individual state can still veto a multistate pipeline project by denying or withholding certain permits."

Notwithstanding the interstate commerce implications of this abuse of authority granted by federal law, the current statutory framework provides no process for resolving such conflicts, according to Santa. "Consequently, we urge you to develop an effective remedy as part of electric transmission siting legislation that also can be applied to interstate natural gas pipeline siting," he said.

INGAA sent copies of the letter to Senate Energy and Natural Resources Committee Chairman Jeff Bingaman (D-NM), ranking minority member Lisa Murkowski (R-Alas.), House Energy and Commerce Committee Chairman Henry A. Waxman (D-Calif.), and ranking minority member Joe Barton (R-Tex.).

Contact Nick Snow at nicks@pennwell.com.

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