January 18, 2018
Carson City, NV – Today, Nevada Attorney General Adam Paul Laxalt applauded a decision by the Federal Energy Regulatory Commission (FERC) to request that developers of multiple pending interstate natural gas pipeline projects adjust their proposed incremental rates resulting from the January 1 reduced tax rate. FERC sent letters on January 12th and 16th to developers on the heels of a January 9th letter issued by a bipartisan coalition of 18 states, including Nevada. The coalition urged FERC to take action to ensure public utility companies pass along these tax savings to consumers:
“I joined an 18 state bipartisan coalition of attorneys general and consumer advocates to protect Nevadans and ensure the benefits of the federal tax reform plan are passed on to utility consumers,” said Attorney General Adam Laxalt. “I am delighted to see that the bipartisan efforts helped prompt quick action by FERC. We encourage federal regulators to continue to look at opportunities for additional pass through savings for consumers throughout the entire State."
“I am pleased to see FERC take immediate action on this important issue,” added Nevada’s Consumer Advocate Ernest Figueroa.
The tax savings arise from the recently enacted federal tax reform plan that reduced the corporate tax rate from 35 percent to 21 percent. As a result of this reform, public utilities now pay lower taxes than were anticipated when their regulated rates were set. According to FERC, developers were given a timeline to respond and provide FERC with an adjusted cost of service and recalculated initial incremental rates for the cost of the pipeline expansions. Developers of the following projects were issued letters thus far: Texas Eastern Transmission LP's South Texas Expansion Project, Florida Gas Transmission Co. LLC's East West project, Columbia Gas Transmission LLC's Eastern Panhandle Project, Gulf South Pipeline Co. LP's Westlake Expansion Project, DTE Midstream Appalachia LLC's Birdsboro Pipeline Project, Southern Natural Gas Co. LLC's Fairburn Expansion Project, Paiute Pipeline Co.'s 2018 Expansion Project, and WBI Energy Transmission Inc.'s Valley Expansion Project. The Paiute pipeline is the primary interstate pipeline in Northern Nevada, and any savings to the Paiute Pipeline Company for this expansion project as a result of tax reform will be passed through to Southwest Gas’ northern Nevada customers when the project is operational.
In addition to Nevada, other states and advocates that participated in issuing the January 9, 2018 letter to FERC include: California, Connecticut, Illinois, Kentucky, Maryland, Massachusetts, New York, North Carolina, Rhode Island, Texas and Virginia, as well as Nevada’s Office of the Consumer Advocate the Connecticut Office of Consumer Counsel, the Florida Office of Public Counsel, the Maine Office of the Public Advocate, the New Hampshire Office of the Consumer Advocate, the Rhode Island Division of Public Utilities and Carriers, and the Vermont Department of Public Service.
To view the letter sent by the coalition of attorneys general on January 9, 2018, click here. The letter issued by Nevada’s consumer advocate to the Public Utilities Commission on January 17, 2018 is attached. A sample of the letter sent by FERC to an energy company on January 16, 2018 is also attached.