Pipelines may file to request Commission approval of market based rates upon showing a lack of market power.
In order to authorize the applicant to charge market-based rates, the Commission must find that the applicant lacks significant market power, i.e., that the market is sufficiently competitive to preclude the pipeline from profitably maintaining prices above competitive levels for a prolonged period of time.
§ 284.503 - Market-based application must include:
- Describe proposed service.
- Define relevant product and geographic markets.
- Provide applicant's ownership and then list affiliated energy companies, services provided, and their location. If an affiliate operates in the same geographic market, the market shares of the applicant and the affiliate should be combined.
- Identify good alternatives to the proposed service - which parties provide similar service within the same geographic market. List the applicant's competitors and location.
- Include market share and Herfindahl-Hirschman Index (HHI) calculations to measure market concentration. The Commission’s traditional HHI threshold is 1,800.
- Discuss other relevant competitive factors such as ease of entry and excess capacity held by competitors.
- Describe how the applicant's rates compare to the competitors.
Filings by NGA Hinshaw Pipelines must be in the form of a request for declaratory order and comply with Part 154. Filings are to be made eTariff. If filing with a Pro Forma SOC use a TOFC of 790. If revising an existing SOC use a TOFC of 760. If filing a new baseline Tariff / SOC use a TOFC of 820.
Filings by NGPA section 311 Pipelines must be in the form of a rate case in accordance with § 284.123(b)(2). Filings are to be made in eTariff. If revising an existing SOC use a TOFC of 760. If filing a new baseline Tariff / SOC use a TOFC of 820