Commissioner James Danly  Statement
April 9, 2021
Docket No. RP21-618-000

I concur with today’s order regarding the request filed by Southern Star Central Gas Pipeline, Inc. (Southern Star) to prospectively waive the invoicing, collection and related crediting of penalties incurred by shippers and delivery point operators following the issuance of Operational Flow Orders (OFOs).  I agree that the waiver as it applies to shippers is consistent with section 8.8 of the General Terms and Conditions (GT&C) of Southern Star’s tariff.[1]  I also agree that we should grant the waiver of GT&C section 10 regarding invoicing, collecting, and crediting the penalties incurred by delivery point operators. 

I write separately to express two concerns.  First, OFOs are necessary to protect the integrity of pipeline systems.  I am therefore generally disinclined to waive tariff provisions related to the issuance of OFOs and their corresponding penalties.  However, in this case, where there were extraordinary circumstances and there is no evidence of gamesmanship by the parties subject to penalties, I support waiving those tariff provisions.

Second, I write to express my anxiety that this order may later serve as a model for an end-run around the filed rate doctrine.  The tariff provisions establishing OFOs and associated penalties were not themselves the subject of this waiver request, but instead waiver was sought for the tariff provisions that relate to the ministerial actions that perfect already-incurred penalties.  In cases such as this, it is doubly important for the Commission to make an honest and clear-eyed assessment of the propriety of the requested waiver under its four-part test.  In particular, the Commission must engage in a searching examination of whether there are unintended consequences such as harm to third parties under the test’s fourth factor.  In this case, I am satisfied that no third party is being deprived of payments to which they would otherwise be entitled.

For these reasons, I respectfully concur.


[1] While the waiver request is consistent with GT&C section 8.8 and Commission policy, the language in that section appears to be overly broad and potentially inconsistent with Commission precedent.  See Panhandle E. Pipe Line Co., LP, 174 FERC ¶ 61,237 (2021) (Danly, Comm’r, concurring).

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