Gas Pipeline 'Overearnings' Investigations

07 July 2011
Hosted By: the Staff Subcommittee on Gas of the National Association of Regulatory Utility Commissioners (NARUC)

On 7 July 2011, NERA Senior Vice President Dr. Jeff D. Makholm and Vice President Kurt Strunk, along with Julia Sullivan, partner at Akin Gump Strauss Hauer & Feld LLP, delivered a presentation to the NARUC Staff Subcommittee on Gas on investigations into gas pipeline earnings. Over the last decade, earned returns on many interstate pipelines have drifted to surprisingly high levels, resulting in a sizable wealth transfer from many millions of gas pipeline ratepayers to the owners of those pipelines. Several pipelines are currently under investigation by the Federal Energy Regulatory Commission (FERC), and several more, according to NERA's calculations, may be "over-earning" but have yet to be investigated by the FERC. This presentation discusses remedies for excessive profitability and calls for either individual or collective action on the part of pipeline customers.

Download the presentation here.

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