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ARTICLE · 15 MAY 2012

FERC Denies Market-Based Rate Application

Failure to provide detailed cost data relating to the provision of oil transportation service causes FERC to deny a pipeline's request to charge market-based initial rates.

United StatesEnergy and Natural Resources
Mark Haskell
Mark Haskell
Charles Moore
Charles Moore
Christina Vitale
Christina Vitale

Failure to provide detailed cost data relating to the provision of oil transportation service causes FERC to deny a pipeline's request to charge market-based initial rates.

On May 7, the Federal Energy Regulatory Commission (FERC or Commission) issued an order denying a request to charge market-based rates as initial rates for transportation service to be provided on the Seaway Crude Pipeline Company (Seaway) system.1 The Commission's order clarifies for oil pipelines seeking market-based authority in the future that detailed cost data is a necessary prerequisite in conducting a market-power analysis in the context of market-based rate applications filed under the Interstate Commerce Act.

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