Pipeline operators are regulated under the Michigan Gas Safety Code, 1969 PA 165, and its rules to ensure that the public safety is protected to the extent possible in the transportation of gas by pipeline. The statute specifically exempts the gathering of gas in rural locations that lie outside the limits of an incorporated or unincorporated city, town, or village. However, gathering lines located in or occupying the property of schools, hospitals, churches, parks, or similar public places are subject to the code. Also, the commission may define other designated residential or commercial area such as a subdivision, business or shopping center, community development, or similar populated area as a non-rural area subject to the code.
Natural gas transmission pipelines are regulated under Act 9 of Public Acts of 1929, and require the issuance of a Certificate of Public Convenience and Necessity by the Commission prior to construction. However, there are certain circumstances where pipelines are exempt from Commission jurisdiction. If the pipeline is a common carrier (transporting gas from two or more owners), the Commission also has jurisdiction over its rates, charges and conditions of service.
In addition, under this statute, the Public Service Commission has the authority to regulate production rates of natural gas from gas wells through the issuance of Well Connection Permits, Allowable Withdrawal Orders and Proration Orders.