NPGA asks FERC for increased pipeline transparency

April 21, 2015 By    

The National Propane Gas Association (NPGA), Airlines for America and the Liquids Shippers Group, which represents 11 large oil and gas companies, filed a petition at the Federal Energy Regulatory Commission (FERC) asking for increased transparency related to reporting the transportation costs and revenues on the nation’s petroleum products and natural gas liquids pipelines.

“The current system is like forcing a car shopper to buy a car without listing the miles-per-gallon, engine type and estimated maintenance costs on the sticker,” says Rick Roldan, NPGA’s president and CEO, in a press release. “Similarly, shippers on the nation’s oil and liquids pipelines do not have the information they need to determine if the prices they are being charged are just and reasonable – a responsibility placed upon them by FERC.”

According to NPGA, FERC does not review pipeline operator rate increases unless a shipper on the pipeline makes a convincing case that the pipeline is overcharging. Oil and liquids pipeline companies are only required to report cost and revenue data on an aggregate basis, NPGA adds. This means a pipeline company can operate 10 separate pipelines, but it is only required to file a single, aggregate report of the costs and revenues associated with the entire system.

“It is time to increase transparency on the system,” Roldan says. “Ultimately, this issue affects nearly every American because pipeline transportation charges become part of the prices paid by all consumers, not just of fuels, but virtually every product sold in the United States.”

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