Significant Gas Pipeline Rate Cases Are Filed, Settled and on the Horizon

What’s the issue?

After the passage of the Tax Cut and Jobs Act of 2017 in December of 2017, there was pressure placed on gas pipelines to adjust their rates to take into account the reduction in the corporate tax rates. However, most of the major pipelines did not do so because they asserted that, even after the tax cut, they were not earning an allowed rate of return.

Why does it matter?

Since 2017 pipelines with total annual revenues equal to about half of the entire industry have filed full rate cases in which they actually sought to increase their rates. Almost all of those have settled over the last few years, though some are still pending and more are on the horizon.

What’s our view?

The major pipelines appear to have been correct in asserting that they should not have lowered their rates following passage of the Tax Cut and Jobs Act of 2017 because in their subsequent rate cases they received substantial increases in their tariff rates. The most recent settlement by Columbia Gas Transmission continues the trend, but not every filing results in a rate increase, as evidenced by the settlement recently filed by Florida Gas Transmission.



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