WASHINGTON, D.C. – In a letter today, U.S. Senators Susan Collins and Angus King and U.S. Representatives Mike Michaud and Chellie Pingree urged the Federal Energy Regulatory Commission to quickly reach a decision regarding the Portland Natural Gas Transmission System 2010 rate proceeding in order to provide certainty to businesses and consumers of natural gas.

“This case is complex and, because of rehearing requests and compliance filing challenges, natural gas consumers in northern New England continue to pay interstate transportation rates that may be more than 50 percent higher than the rate that the Commission finally approves. While these higher rates may ultimately be refunded, we are concerned that consumers face another winter heating season paying more than they should,” they wrote. “…Further, uncertainty about transportation rates creates a difficult business climate for the pipeline owners, the shippers, and, ultimately, retail customers. The pipeline owners need business certainty and the retail customers should not pay higher than necessary rates. Additionally, our Maine paper mills face too many challenges – from foreign trade to changing market conditions – and they should not be asked to continue paying gas pipeline shipping rates that have not been approved by the Commission.”

On May 12, 2010, Portland Natural Gas Transmission System (PNGTS), which is a partnership between TransCanada Corporation and Gaz Metro, Inc of Quebec, applied to the Federal Energy Regulatory Commission (FERC) for a shipping rate increase. Under current law, PNGTS is allowed to charge its contracting entities the higher requested rate until FERC decides to approve or deny the application. In the meantime, that rate increase is absorbed by the contracting entities and then passed along to consumers who ultimately pay for it through higher energy bills. However, if FERC ultimately denies the application, then those contracting entities and their consumers are entitled to refunds and a return to lower energy bills. However, with the onset of winter, the absence of a timely decision from FERC has created a climate of unpredictability for businesses that rely on the pipeline for their supply of natural gas. A decision by FERC would give businesses the certainty needed to make long-term investments in our state.

The complete text of the letter is below and can be read HERE:

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December 16, 2014

Dear Chairman LaFleur:

We write in regard to requests for rehearing that have been filed in the Portland Natural Gas Transmission System (PNGTS) 2010 rate proceeding (Docket No. RP10-729). PNGTS applied for a rate increase on May 12, 2010, and since the fall of 2010 has been charging a firm transportation rate of approximately $1.32 per Dth. This case is complex and, because of rehearing requests and compliance filing challenges, natural gas consumers in northern New England continue to pay interstate transportation rates that may be more than 50 percent higher than the rate that the Commission finally approves.

While these higher rates may ultimately be refunded, we are concerned that consumers face another winter heating season paying more than they should. Moreover, given that the previous PNGTS rate case (Docket No. RP08-306) overlapped with the 2010 case, it has been more than six years since shippers on PNGTS have paid transportation rates that have received Commission scrutiny and approval. Unless these higher rates are found by the Commission to be just and reasonable, consumers cannot be asked to pay higher shipping rates during a time of skyrocketing natural gas and electricity prices. 

Further, uncertainty about transportation rates creates a difficult business climate for the pipeline owners, the shippers, and, ultimately, retail customers. The pipeline owners need business certainty and the retail customers should not pay higher than necessary rates. Additionally, our Maine paper mills face too many challenges – from foreign trade to changing market conditions – and they should not be asked to continue paying gas pipeline shipping rates that have not been approved by the Commission. 

We urge the Commission to decide this rate proceeding as expeditiously as possible.

Sincerely,

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