Cantwell: We Should Focus on Using Existing Pipelines More Efficiently

Press Release

Today, Ranking Member of the Senate Energy and Natural Resources Committee U.S. Senator Maria Cantwell (D-Wash.) called for using existing pipelines more efficiently and asked experts about changes in the natural gas market.

Sen. Cantwell urged both federal and state regulators to ensure that pipelines will not endanger public health and safety before approval. "I am not against building new pipelines, when necessary," Sen. Cantwell said. "New pipelines must meet federal and state standards so that public health and safety will not be impaired."

Reiterating a recommendation from the U.S. Department of Energy's Quadrennial Energy Review, Sen. Cantwell suggested an examination of how efficiently existing pipelines are used before proposing new ones. "We undoubtedly will need some additional natural gas pipeline capacity. … We should focus first on using existing pipelines more efficiently."

On a related note, Mr. Peress of the Environmental Defense Fund discussed changes in the natural gas market. Specifically, he testified that: "The [natural gas] market is completely based on bilateral contracts between pipelines and their customers for capacity. Capacity does not necessarily equal deliverability. What customers need is they need to get fuel delivered to them. Because that deliverability is not priced, … we see inefficiencies in the way that pipelines are operated."

Sen. Cantwell followed up asking, "how do you think we make this transition?" Mr. Peress responded, "There needs to be a shift in the rate design, so that as pipelines are incented to provide more flexible deliverability services, they can earn and garner revenues from those services, which are actually the services that customers need."

Lastly, Sen. Cantwell noted the differences between provisions in the House and Senate energy bills on pipeline siting: "The Senate energy bill attempts to enhance coordination between Federal Energy Regulatory Commission (FERC) and other federal and state agencies with responsibility for issuing permits before a new pipeline is built. In contrast, the House-passed bill proposes to give FERC just 90 days to make a final decision on permit applications, no matter the complexity of the proposed pipeline or the potential impact on people or the environment. This is something that we cannot do."

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