Federal regulation of the pipeline industry. A summary review. Technical report, Task 2

Technical Report · Tue May 31 04:00:00 EDT 1977

DOI:https://doi.org/10.2172/5924468· OSTI ID:5924468

Banks, W. F.

The principal purposes of this report are to identify the jurisdiction areas of the federal pipeline regulating agencies, and to examine the amenability of the regulatory system to the introduction of energy-conservative new technology into the pipeline industry. The history, scope, and agency structure of state and federal regulation are recounted and some gaps, overlaps, and ambiguities are identified. The only significant inhibitory effects upon technological innovation are found to derive from the FPC and ICC limits upon profit, the 1941 Justice Department consent decree limiting dividends to shipper-owned pipelines, and the income tax rules governing recovery of investment credits and startup losses. Effects of these limits are explored by simulation studies using the Systems, Science and Software pipeline economic model (PEM). Two new concepts of regulation are proposed which would neutralize the inhibitory effect of the present regulatory system and would motivate pipeline operators to conserve energy: one, the use of a national equivalent value in the economic trade-off analyses which justify entry of a technological innovation into the rate base (valuation); and two, a valuation allowance which would reverse the presently often-existing situation and insure that the pipeline operator would realize a greater profit from saving energy than from wasting it.

• Research Organization: Energy Research and Development Administration, San Francisco, CA (USA). San Francisco Operations Office
• Sponsoring Organization: USDOE
• OSTI ID: 5924468
• Report Number(s): SAN-1171-3
• Country of Publication: United States
• Language: English

Related Subjects

29 ENERGY PLANNING, POLICY, AND ECONOMY
291000 -- Energy Planning & Policy-- Conservation
293000 -- Energy Planning & Policy-- Policy
Legislation
& Regulation
32 ENERGY CONSERVATION, CONSUMPTION, AND UTILIZATION
320205* -- Energy Conservation
Consumption
& Utilization-- Transportation-- Pipeline
ENERGY CONSERVATION
INCOME
INDUSTRY
INVESTMENT
MATHEMATICAL MODELS
PIPELINES
PROFITS
REGULATIONS
TAXES