Section 42.08.350. Initial or revised rates.

   (a) An in-state natural gas pipeline carrier may not establish or place in effect an initial recourse tariff containing rates, charges, rules, regulations, conditions of service, or practices without providing notice to the commission and to the public at least 90 days before establishing or placing in effect the initial recourse tariff. Notice shall be filed with the commission before an open season and by making the recourse tariff provisions available for public inspection. The notice shall plainly indicate the time when the recourse tariff will go into effect and include a supporting cost study. The commission may prescribe additional requirements for the notice and the form in which the notice must be provided. The commission, for good cause shown, may allow initial recourse tariffs to take effect on less than 90 days' notice under conditions the commission prescribes by order. Submission of a precedent agreement or an associated contract is not subject to this section.
   (b) The commission shall review the proposed initial recourse tariff and verify that the proposed terms and conditions of service are not unduly discriminatory. The commission also shall review the supporting cost study provided with an initial recourse tariff filing and verify, taking into consideration the expected risks, that the proposed rate of return on equity is within the range of permissible rates of return as determined by the Federal Energy Regulatory Commission in recent decisions related to the construction of natural gas pipelines, that the cost study incorporates a reasonable depreciation methodology and depreciable life, and that the cost study uses a reasonable capital structure. A proposed depreciation methodology, depreciable life, or capital structure is reasonable if it is commonly accepted or used by the commission or the Federal Energy Regulatory Commission.
   (c) Upon written complaint or in its own motion, and after reasonable notice, the commission may conduct a hearing to determine whether the initial recourse tariff filed with the commission complies with the requirements in (b) of this section. Pending a hearing the commission may, by order stating the reasons for its action, suspend the operation of the initial recourse tariff for a period not longer than 30 days beyond the time when the initial recourse tariff would otherwise go into effect. An order suspending an initial recourse tariff filing may be vacated if, after investigation, the commission finds that it is in all respects proper. Otherwise, the commission shall hold a hearing on the suspended filing and issue its order, before the end of the suspension period, approving or denying the suspended initial recourse tariff.
   (d) Unless a recourse tariff is denied because it includes a proposed term or condition of service that is unduly discriminatory, includes a proposed rate element that does not comply with (b) of this section, or violates a provision of this chapter, the commission shall approve the initial recourse tariff. If the commission does not issue its ruling within the 90-day period, and the period of suspension, if any, the initial recourse tariff filing shall be considered approved.
   (e) An in-state natural gas pipeline carrier may not establish or place in effect a revised rate, charge, rule, regulation, condition of service, or practice contained in a recourse tariff before providing notice to the commission and to the public at least 90 days before taking the action. After construction or an expansion of the pipeline, and at any time that a carrier files for a revised recourse rate, the carrier shall file a supporting cost study. Notice shall be given by filing with the commission and keeping open for public inspection the revised recourse tariff provisions, which shall plainly indicate the changes to be made in the schedules then in force and the time when the changes will go into effect. The commission may prescribe additional means of giving notice. The commission, for good cause shown, may allow changes to take effect on shorter notice under conditions the commission prescribes by order. Submission of a precedent agreement or an associated contract is not subject to this subsection.
   (f) The commission shall review a proposed revised recourse tariff in the same manner as the review of a proposed initial recourse tariff under (b) of this section, except that the depreciable life may be adjusted in accordance with the time period between the approval of the recourse tariff and the approval of the revised recourse tariff. The commission shall verify that the carrier is using the same elements that were last approved by the commission. A proposed recourse tariff with a new or revised term or condition of service that is unduly discriminatory shall be denied. The commission also shall deny a revised tariff rate that does not use the previously approved value of the specified rate element, unless the carrier proves that the new value is just and reasonable. If the commission does not issue its ruling within 90 days, the revised recourse tariff filing shall be considered approved.
   (g) A person initiating a change in an existing recourse tariff bears the burden of proving the reasonableness of the change. The in-state natural gas pipeline carrier bears the burden of proving the recourse tariff terms and conditions are not unduly discriminatory.
   (h) An in-state natural gas pipeline carrier shall provide for separate rates for one or more classes of firm transportation service and for interruptible transportation service in a recourse tariff filed with the commission under (a) of this section. An in-state natural gas pipeline carrier may impose a reservation fee or similar charge for reservation of capacity in an in-state natural gas pipeline as a condition of providing firm transportation service, but may not impose a reservation fee or similar charge for reservation of capacity in an in-state natural gas pipeline for interruptible transportation service.

Authorities

42.08.220;42.08.340;42.08.450

Notes

References

AS 42.08.220 General powers and duties.
AS 42.08.340 Filing requirements; recourse tariffs.
AS 42.08.450 Accounts; records; triennial reports.

History

(Sec. 21 ch 11 SLA 2013)