Register Today for Courses in Cost of Service and Rate Design for Natural Gas Interstate Pipeline Companies (January 26th-27th)
Brown, Williams, Moorhead & Quinn, Inc.

Energy infrastructure is literally the backbone of the energy industry and the foundation for reliability and the array of modern service offerings and operational flexibility customers have increasingly come to expect. In order for the industry to respond to the changes and challenges of the future, it is essential that infrastructure projects be permitted and constructed in a timely, legally-compliant safe and economically efficient way. Regulatory processes are evolving toward earlier communication with stakeholders to identify and resolve issues, coordination and concurrent action among agencies responsible for various aspects of the project.. Brown Williams has the expertise to guide you through these processes and reach a successful conclusion. We stay current with regulatory developments and will advise you on how any new policies might affect your project

Acquisitions and Abandonments

Essentially the same rules and policies apply to acquisitions of facilities with somewhat less emphasis on environmental impacts due to the absence of new construction. Here BWMQ can add value with its expertise in FERC policy and precedent regarding acquisition costs ranging from book value to replacement cost, and thus the rate that can be charged. Note that acquisitions of securities of by corporate reorganization, rather than physical assets, do not require certificate authorization. Abandonment of facilities and/or services is the flip side of certificates, but subject to the same public convenience and necessity requirement. BWMQ can help you make the threshold showing on the impact of the abandonment on customers whose service will be terminated and describe the environmental impacts of facilities to be abandoned in place or by salvage.

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Developing the Application

Simultaneously with the pre-filing process,  the project sponsor should be conducting an open season to gauge the market and to ensure that the capacity will be made available on a not unduly discriminatory basis to all potential shippers. For an existing pipeline company, FERC’s policy also requires a “reverse open season” to determine if existing shippers desire to give up capacity permanently. These steps ensure that the new project is optimally sized. With the exception of those regulations applying to any Alaskan pipeline, there are no formal requirements for how or how long an open season must be conducted. FERC has required repeated open seasons in response to complaints by would-be shippers. The open seasons result in binding precedent agreements which form the most common basis for the applicant’s market showing. BMWQ can help plan and conduct the open seasons and provide advice on the content of precedent agreements and/or other evidence of market support.

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Filing and Monitoring the Application

BWMQ is thoroughly familiar with the FERC eFiling procedures, and we are confident that with our input your application will be accepted as complete for public notice. During the pendency of the application, we are available to help respond to staff data requests and other parties’ comments and protests.  We could also attend on-site public meetings or agency technical conferences as your representative. Our staff has extensive contacts with senior FERC and other  agency personnel that  are useful in understanding current construction policies and how best to facilitate moving projects forward. Our goal is to help you obtain a certificate within a timeframe that meets your construction schedule and in-service commitments, and we have been very successful in that regard.

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Pre-filing Support

Although FERC’s Order No. 665 makes the pre-filing process mandatory only for LNG projects, in practice it is used for all greenfield pipeline and storage projects and major expansions. It is during this phase that FERC and other agencies’ staff, the public and other interested parties can freely communicate, identify and resolve issues and expedite the application once it is filed. The process begins with visits to FERC and other federal and state agencies, which BWMQ can facilitate. At this stage, the issues primarily are environmental and land use, rather than commercial.

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Preparing Required Exhibits

Each application requires a number of separate exhibits in specific subject areas such as hydraulic flow diagrams, environmental impacts, market, financing, revenue, expenses and income and tariff. BWMQ specializes in developing initial rates for incrementally-priced projects or those of new entities, calculating the impact on existing shippers for rolled-in pricing projects and formulating tariff terms and conditions of service. In addition to the traditional firm and interruptible transportation services, we are experts at innovating new services such as parking, loaning, wheeling and semi-firm.  As the natural gas and electric industry work to develop new services that will facilitate greater use of natural gas for electric generation, BWMQ will be ready to assist clients on implementing those new services.

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