Administrative Law Judge Rules That High HHI Market Concentrations and Other Factors Disqualify ANR Storage Co. from Charging Market-Based Rates

摘要

An Initial Decision (ID) issued January 29 by Administrative Law Judge John Dring addressed and recommended the rejection of a petition of ANR Storage Co. (ANRS) (RP12-479) seeking FERC’s authorization to charge market-based rates in a “ Central Great Lakes” vicinity service area. The declaratory order proceeding had its origins in a FERC-initiated action in 2012 to determine whether ANRS’s rates are just and reasonable. The Commission found in setting the case for hearing (NGA section 5) that, based on Form No. 2 data, ANRS received an estimated return on equity of 130.38% in 2009 and 153.71% in 2010. After the case was set for hearing, ANRS, its customers, and Commission Staff agreed to a settlement that ended the investigation by lowering ANRS’s rates 55% for monthly deliverability and 51% for monthly capacity. However, ANRS then requested a declaratory order granting it authorization to charge market-based rates for its gas storage service and approving various waiver requests for cost-based rate information. ANRS sought authority to sell firm and interruptible storage services at market-based rates and argued that it is unable to exercise market power.