§720a Issuance of Certificate of Public Convenience and Necessity

Summary

The Federal Energy Regulatory Commission (FERC) can review and approve permits to build and run Alaska natural gas pipelines that are not the big Alaska gas system. If an applicant meets the rules in section 7(e) of the Natural Gas Act, FERC must issue a certificate. FERC will start with the assumption that the project is needed and that there will be enough downstream capacity to move the gas to markets in the lower 48. Within 60 days after the final environmental impact statement is issued under section 720b, FERC must issue a final order to grant or deny the certificate. No federal approval can be given for any pipeline that goes under the Beaufort Sea shoreline and then enters Canada north of 68 degrees north latitude. Within 120 days after October 13, 2004, FERC had to make rules for how open seasons are run for these projects, including timing, how capacity is allocated, and steps to promote competition; extra capacity beyond the initial amount must allow gas from places other than Prudhoe Bay and Point Thomson. Capacity allocations follow FERC’s rules unless an expansion is ordered under section 720c. Applications for extra pipeline work to move Alaska gas from Canada to the lower 48 can be made under the Natural Gas Act, and if an expansion involves facilities built under the 1976 Alaska Act, that Act still applies. The certificate holder must show it studied Alaska’s in‑state needs and possible tie‑in points. After a state request and a hearing, the state may get reasonable access to move its royalty gas for local use, but that access cannot raise the rates of shippers who already have subscribed capacity as of the access date. FERC can make any additional rules needed to carry out these requirements.