The Federal Energy Regulatory Commission (FERC) amended its regulations governing the provision of unbundled pipeline transportation service (see discussion of Orders 636 and 436 below) in response to the growing development of more competitive markets for natural gas and its transportation.
As an experiment, the rule waived for a two-year period cost-based price ceilings for short-term releases of capacity by shippers with long-term rights to the capacity. FERC later reinstated the cap.
FERC encouraged pipelines to file for peak/off-peak and term-differentiated rate structures. It also mandated significant new shipper transportation rights in terms of scheduling procedures, primary and secondary point rights, and the ability to segment shipper capacity paths.
In order to remove economic biases in the existing regulations, Order 637 narrowed a shipper’s “right of first refusal” to re-subscribe to long-term capacity.
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Order No. 637
Last updated: 06/22/2007
Regulation of Short-term Natural Gas Transportation Services, and Regulation of Interstate Natural Gas Transportation Services (Final Rule). February 9, 1999
799KB, PDF
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Order No. 637-A
Last updated: 06/22/2007
Order on Rehearing, Rehearing of Short-term Natural Gas Transportation Services, and Regulation of Interstate Natural Gas Transportation Services (Final Rule). May 19, 2000
112KB, PDF
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Order No. 637-B
Last updated: 06/22/2007
Order Denying Rehearing Concerning Regulation of Short-Term Natural Gas Transportation Services (Final Rule). July 26, 2000
112KB, PDF