FERC properly allowed premium rates to be applied in the sale of a pipeline connecting Missouri and Illinois, the D.C. Circuit ruled this week. After MoGas, a pipeline operator, purchased a 5.6 mile natural gas pipeline running under the Mississippi River, the Federal Energy Regulatory Commission (FERC) allowed it to charge premium rates as a "benefits exception" to usual limitations.
The Missouri Public Service Commission sued, arguing that purchasing the pipeline served no public benefit and ran counter to FERC precedent. The court, however, disagreed, choosing to defer to FERC's interpretation of its own regulations.