Opinion ID: 530275
Heading Depth: 3
Heading Rank: 3

Heading: FERC's Rejection of the alternative conditions proposed by Tarpon.

Text: 19 FERC has broad authority to attach conditions to the issuance of a certificate that the public convenience and necessity may require. Tennessee Gas Pipeline Co. v. FERC, 689 F.2d 212, 214 (D.C.Cir.1982). Under that authority, FERC will scrutinize individual section 7 certificates and attach those conditions necessary to prevent against undue discrimination. See, e.g., Great Lakes Gas Transmission Co., 44 F.E.R.C. p 61,359 (Sept. 21, 1988). In this case, FERC did this, and attached several conditions that would facilitate FERC's ability to monitor and prevent discrimination by Midwestern in the future. Nevertheless, Tarpon contends that two additional conditions were required to mitigate the discriminatory effect of the transaction as approved. 20 First, Tarpon argued that FERC should have imposed a contract conversion condition on the certificate that would require Midwestern to offer existing sales customers the right to convert their sales entitlements to firm transportation service. Tarpon based this request on FERC's statement in Order No. 436 that the conversion option was essential if the goal of non-discriminatory access to transportation is to be achieved. Order No. 436, 50 Fed.Reg. at 42438 (1985). While that may be true where a pipeline seeks a blanket certificate under Order No. 436, that does not mean that it is required in every individual section 7 certificate. In its order after rehearing, FERC concluded that since no finding of discrimination against Midwestern has been made, [w]e have no basis to conclude that Midwestern will not comply with its stated intention to provide nondiscriminatory transportation services for any shipper who requests such service. Midwestern Gas Transmission Co., 43 F.E.R.C. p 61,475, at 62,170 (June 16, 1988). And, we have no basis to conclude otherwise. 21 In the alternative, Tarpon contends that rate conditions must be placed on Midwestern's interruptible transportation service to reduce the bias that excessive interruptible transportation rates will otherwise inject in favor of Midwestern's sales customers. Application of Tarpon Gas Marketing, Ltd. for Rehearing or, in the alternative, for Clarification, Midwestern Gas Transmission Co., (May 11, 1988), J.A. at 133. FERC essentially deferred these issues to a pending rate proceeding for Midwestern (Docket No. RP86-33-001) as the more appropriate forum. FERC's decision not to attach these two conditions to the certificate is supported by the record, is consistent with this court's decision in Northern Natural Gas Co. v. FERC, 827 F.2d 779 (D.C.Cir.1987), and should not be disturbed on appeal.