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FERC Natural Gas 101 provides a comprehensive overview of the agency’s impact on the natural gas and LNG industries. This day and a half course is for those seeking a basic knowledge of FERC’s natural gas and LNG policies and regulations, those desiring a look at the setting of transportation and storage rates, those wanting a refresher course, and those who want to learn about the current hot topics at the agency.
Learning Outcomes
- Discuss fundamentals of natural gas regulation
- Review jurisdictional reach of and limits on FERC’s power
- Explain how FERC’s exercise of that power affects the regulated entities that it oversees
- Evaluate FERC policies and decisions on issues such as capacity management, secondary markets, and certification of projects; ratemaking, including developing cost-of- service rates and market-based rates; storage; standards of conduct and enforcement; LNG; as well as other timely issues
- Identify future challenges
TUESDAY, OCTOBER 12, 2020 9:00 a.m. – 4:00 p.m. Central Time
FERC from a Historical Perspective – Evolution of an Agency
- FPC/FERC
- Growth and increased oversight
- Current organization and divisional responsibilities
- Prospective changes
FERC Jurisdiction and Regulatory Overview – How FERC Regulates the Natural Gas Industry
- FERC responsibilities and oversight – what does FERC regulate
- Interstate facilities- pipelines and storage
- Production?
- Different docket classifications
- Interactions with other federal agencies and state regulators
- Current FERC objectives (LNG)
- Enforcement and brief overview of compliance
Major Orders and Regulations Impacting the Natural Gas Industry
- Key terms
- Regulatory initiatives
- Open access
- Recent major orders
- Regulatory trends for the future
Pipeline Tariffs – How FERC Regulates Interstate Pipelines and Storage
- Purpose
- Structure and components
- Rate design
Capacity Transactions- How Gas Flows and is Regulated by FERC
- Capacity- what is it?
- Market transparency
- Capacity releases – primary regulations and posting and bidding requirements;
- Secondary market transactions and oversight – shipper must have title; prohibition on buy/sell arrangements; anti-tying policy; flipping
- Asset management agreements
FERC Enforcement – Increased Oversight and Penalties
- Jurisdiction over natural gas activities
- Penalties authority/penalty guidelines
- FERC enforcement’s current areas of focus
- Market manipulation
- Trends and overview of recent investigations and penalties
- Compliance
The Impact of Natural Gas/Electric Coordination
- FERC’s role
- Impact of fracking production
- Regional supply and flow changes
- Increased reliance of power generation on natural gas
WEDNESDAY, OCTOBER 13, 2021 9:00 a.m. – 12:00 p.m. Central Time
FERC Ratemaking Authorities
- Section 7 of the Natural Gas Act
- Section 5 of the Natural Gas Act (Burden of Proof-Remedies)
- Section 4 of the Natural Gas Act (Burden of Proof-Mechanics)
FERC Pipeline Rates-The Procedure
- Filing
- Participants
- Settlements
- Litigation
FERC “Just & Reasonable” Rates – Cost of Service
- Base period, adjustment period, test period
- Operating expenses
- Administrative & general expenses
- Rate base
- Return on Investment
FERC “Just & Reasonable” Rates – Allocation & Rate Design
- Transportation, storage, incremental facilities
- Allocation factors
- Billing determinants
- Firm vs. interruptible rates
- Discounted and negotiated rates
- FERC pipeline rate walkthrough (example and sample problem)
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