In a move somewhat unusual in the context of its normal exercise of authority with respect to hydroelectric licenses, on January 15, 2013 FERC publicly issued a “Staff Notice of Violations”, stating that its staff had preliminarily determined that Seneca Falls Power Corporation has violated several articles of the license for the Seneca Falls Project, No. P-2438, located in upstate New York. The litany of alleged violations is long, ranging from failure to procure and maintain adequate property rights for the project to failure to meet certain environmental conditions, such as maintenance of water elevations, installing fish passage facilities, monitoring wetlands and installing recreational facilities. The procedural posture of the case is that the FERC Office of Enforcement Staff has now completed its fact-finding, presented Seneca Falls with its preliminary findings, Seneca Falls has had the opportunity to respond and Staff has had an opportunity to analyze the response. Frequently after a Notice of Alleged Violation, we see that the subject of an investigation enters into a settlement with FERC Enforcement Staff. The Notice of Alleged Violation is the first time the Office of Enforcement’s investigation becomes public. (more…)
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Keeping with the Agency’s previously announced schedule, the Environmental Protection Agency (EPA) released a progress report on its ongoing “Plan to Study the Potential Impacts of Hydraulic Fracturing on Drinking Water Resources”. The Progress Report outlines the framework for the final study, which is scheduled to be completed in 2014, and highlights the work currently underway and the status of 18 research projects as of September 2012. Just about midway through the study period, EPA has taken a few research questions off the table to avoid overlap with the work of other federal agencies and dropped one of the prospective case studies. Still, the overall focus of the study is rather broad and the Agency continues to spend a significant amount of resources looking into drilling operations not uniquely associated with the hydraulic fracturing process. (more…)
On December 5th, the U.S. Department of Energy (DOE) released its long-awaited second independent study from NERA Economic Consulting (NERA) on the impact of increased exports of liquefied natural gas (LNG) to foreign countries. The release of the NERA study kicks off an important period for companies invested in and impacted by LNG export policy.
Release of NERA Study and Public Comment Process
The NERA study is notable first for its robust conclusion that all scenarios studied predict “net economic benefits from allowing LNG exports” for the United States. Moreover, NERA found that net economic benefits to the U.S. economy would be expected to increase as the level of LNG exports increased, in every market scenario examined. Such conclusions will make it increasingly difficult for LNG export critics from Capitol Hill, the environmental activist community, and some industrial sectors to argue for restrictions on macroeconomic grounds. (more…)
Following FERC’s November 15 order that directed additional technical conferences on gas-electric coordination issues and released the Staff Report on Gas-Electric Coordination Technical Conferences (FERC Staff Report), the North American Electric Reliability Corporation (NERC) is expected to complete a study on the topic by year end. Based on that study, NERC could initiate a task force to explore possible revisions to reliability standards to address concerns related to gas-electric interdependency and fuel availability. (more…)
Effective immediately, Pipeline and Hazardous Materials Safety Administration (PHMSA) inspections will emphasize the review of operator methods for integrity management (IM) program evaluations, the agency said in an Advisory Bulletin released earlier today. PHMSA also stated that it will carefully evaluate whether operators have meaningful metrics to identify how well they are implementing their IM programs, how well their systems are responding to their IM programs, and how well their systems’ integrity is maintained.
The Advisory Bulletin is not surprising in light of concerns that the National Transportation Safety Board (NTSB) raised in its investigation of PG&E’s September 2010 gas pipeline accident in San Bruno, California. In its report on that investigation, (more…)
The specter of enforcement actions by the Federal Energy Regulatory Commission is looming large over the energy industries. In the post-election flurry of FERC enforcement activity, FERC curtailed JP Morgan Venture Energy Corp.’s authority to sell power at market-based rates; opened investigations into the rates of two oil pipelines, Wyoming Interstate Company, L.L.C. and Viking Gas Transmission Company; settled with Gila River Power, LLC over allegations of market manipulation in the California energy markets; initiated an inquiry to improve price transparency in the natural gas markets; and initiated approximately ten audits of natural gas pipelines and other energy industry market participants. Buried amongst this industry-shaking deluge was the FERC Office of Enforcement’s 2012 Report on Enforcement.
In the report, FERC Enforcement stated it was going to continue focusing on last year’s priorities, which were: (more…)