Opinion ID: 721438
Heading Depth: 3
Heading Rank: 1

Heading: Ripeness of petitioners' challenges to FERC's treatment of GSR transition costs

Text: 279 Settled principles of ripeness require that [a court] postpone review of administrative decisions where (1) delay would permit better review of the issues while (2) causing no significant hardship to the parties. Northern Indiana Public Service Co. v. FERC, 954 F.2d 736, 738 (D.C.Cir.1992) (NIPSCO). FERC argues that none of the petitioners' challenges to its allocation of GSR costs are ripe for review. It notes that, under Order No. 636, a pipeline may file ... to recover GSR costs only after it has restructured its system in full compliance with the rule and argues that disputes over GSR cost recovery are therefore better left to individual restructuring proceedings. See Order No. 636, p 30,939, at 30,460; Order No. 636-B, p 61,272, at 62,042. Additionally, FERC noted in Order No. 636-B that the Order No. 636 series transition cost policies are not incorporated in the regulations, but are policy statements. Order No. 636-B, p 61,272, at 62,034-35. It further explained [319 U.S.App.D.C. 120] that it would review specific proposals for recovering transition costs with reference to the particular circumstances of each pipeline system and the degree of support those proposals enjoy from the affected parties. Id.; see also Order No. 636-A,p 30,950, at 30,648-49 (Guidelines and policies will be developed ... in concrete cases to address concerns about GSR cost recovery.). FERC thus compares this case to AGA I, 888 F.2d 136, which held unripe challenges to Order No. 500's equitable sharing policy in light of the strong norm against reviewing policy statements and other tentative agency positions where no hardship will result to the parties. 280 The problem with FERC's ripeness argument is that it fails to meet NIPSCO's two criteria for declaring a case unripe. The Commission claims that it intended in the Order No. 636 series to merely announce a general policy approach to GSR costs and leave analysis of specific GSR cost disputes to individual pipeline restructuring proceedings. Where the language and context of [an agency] statement are inconclusive, we have turned to the agency's actual applications. Public Citizen, Inc. v. NRC, 940 F.2d 679, 682 (D.C.Cir.1991). In this case, FERC's treatment of the GSR cost issue in subsequent proceedings is inconsistent with a general policy approach. For example, in restructuring proceedings for Texas Eastern Transmission Corporation, petitioners challenged FERC's allocation of GSR costs, but FERC determined that [b]ecause the Commission has addressed all of the Industrial Groups' arguments in Order No. 636 et seq., the Industrial Groups' request for rehearing is denied. Texas Eastern Transmission Corp., 63 FERC p 61,100, at 61,512 (1993). In Texas Eastern's NGA § 4 filing for the recovery of GSR costs, FERC again refused to consider these arguments. See Texas Eastern Transmission Corp., 63 FERC p 61,254, at 63,245-46 (1993). In Columbia Gas Transmission Corp., 64 FERC p 61,365, at 63,588 (1993), FERC refused to consider certain GSR cost arguments because they were essentially a request for rehearing of Order No. 636. There is no need to revisit these arguments again. We deny rehearing. In ANR Pipeline Co., 64 FERC p 61,140, at 62,083-84 (1993), FERC rejected arguments about GSR costs for the same reasons stated in Order No. 636-B. 281 Unlike the situation in Papago Tribal Utility Authority v. FERC, 628 F.2d 235, 240 (D.C.Cir.1980), where we found that FERC might resolve the claims of the parties and obviate any injury to them if we allow it to complete its proceedings, FERC has demonstrated that it does not plan to offer any significant justifications for its treatment of GSR costs as outlined in the Order No. 636 series other than those presented in the Order No. 636 series itself. We therefore hold that FERC's treatment of GSR costs does not constitute an unreviewable general policy statement but rather a final determination ripe for judicial review. Because FERC continually relies on the Order No. 636 series' treatment of GSR costs, it is not reasonable to conclude that a delay in review would permit better review of the issue. 282 The second part of the NIPSCO test asks whether delay in review would cause significant hardship to the parties. Put another way, the petitioners must show a direct and immediate effect on their primary conduct. Tenneco Gas v. FERC, 969 F.2d 1187, 1211 (D.C.Cir.1992). FERC admits that Order No. 636 GSR costs as of February 7, 1996, totaled almost $1.7 billion without interest, hardly an insignificant amount. In any case, it is unlikely that FERC would have gone to such lengths to assure that pipelines recover 100% of GSR costs if those costs were unlikely to have an immediate effect on the conduct of the parties having to pay them. Furthermore, to the extent that pipelines and gas producers continue to renegotiate contracts, such negotiations will undoubtedly be affected by FERC's treatment of GSR costs in the Order No. 636 series (and in the individual restructuring proceedings). We accordingly conclude that FERC's treatment of GSR costs causes a direct and immediate effect on the petitioners' primary conduct, and that the petitioners' claims are ripe for review.