Impact of New Pipeline Infrastructure Tied to Firm Capacity Contract Debates

On May 2, 2016, the Federal Energy Regulatory Commission (FERC) issued a favorable environmental assessment for the Atlantic Bridge natural gas pipeline project that would supply New England states and the Maritime provinces of Canada. The project would provide additional firm pipeline capacity required to meet Northeast market growth and has preexisting agreements to account for its entire capacity. FERC has convened a technical conference to consider wholesale market rules that encourage firm capacity contracts to facilitate pipeline expansions and projects. Electric market design changes providing ways to recover the cost of firm pipeline capacity – where needed for electric reliability – would support existing and incentivize additional pipeline infrastructure necessary to alleviate constraints.