On April 18, 2024, Senators Richard Blumenthal (D-CT) and Cindy Hyde-Smith (R-MS) introduced the Making Pipelines Accountable to Consumers and Taxpayers Act (“MPACT Act”) (S. 4171) that, if adopted, would grant FERC authority to order refunds under section 5 of the Natural Gas Act (“NGA”). Specifically, the MPACT Act amends section 5 of the NGA to give FERC authority to order a pipeline to issue retroactive refunds for charges FERC determines are unjust and unreasonable. The MPACT is intended to align FERC’s authority over the gas and electric industries and protect customers from unjust and unreasonable rates. At this time, a companion bill has not been introduced in the House of Representatives.

Under the NGA, FERC has the authority to order interstate natural gas pipelines to reduce their rates. However, FERC’s authority is limited under section 5 of the NGA. In a NGA section 5 investigation, a proceeding initiated by FERC or third parties challenging a pipeline’s rates, FERC is only authorized to reduce rates prospectively after it issues a final order. As a result, FERC cannot order an interstate natural gas pipeline to issue retroactive refunds for charges it finds unreasonable. In contrast, under section 206 of the Federal Power Act, the parallel complaint and investigation statute for electric utility rates, FERC is permitted to issue rate refunds back to the date a complaint was filed at FERC. The MPACT Act is designed to remedy this disparity by amending section 5 of the NGA to give FERC authority to order retroactive refunds when it determines rates are unjust and unreasonable. If the MPACT Act is passed and enacted by Congress, this would align FERC’s authority over the natural gas and electric industries by allowing FERC to issue retroactive refunds to unjust and unreasonable rates.

In comments surrounding the MPACT Act, Senator Blumenthal stated, “[w]e must close a legal loophole that natural gas pipeline companies have used routinely and reprehensibly to exploit consumers. The companies overcharge consumers who are unable to receive full reimbursements under current law. This is a matter of simple fairness: if consumers are overcharged for a utility, they should be made whole. With the [MPACT Act], we can hold natural gas pipeline operators accountable for stealing money out of consumers’ pockets and ensure that those consumers are paying only the correct, reasonable rate.” Additionally, Senator Hyde-Smith stated, “[t]his legislation is a matter of basic fairness to consumers in Mississippi and elsewhere, whether they use natural gas to cook meals or heat a poultry house. Right now they have no recourse or chance for a refund when an interstate natural gas pipeline makes millions of dollars in overcharges. We need this legislation to close this loophole and ensure natural gas pipeline regulations are transparent for the American people.”

Proponents of the MPACT Act, including the American Public Gas Association (“APGA”), commented in support of the MPACT Act explaining that “[i]f enacted, this bill will help keep rates affordable for Americans using energy in their homes and businesses. The millions of gas consumers across the country deserve the same protections afforded to electric consumers when interstate transmission entities charge excessive rates. This legislation is critical to continue the efforts of public gas utilities to deliver affordable, reliable, and efficient energy to their customers in.”

The full text of the MPACT Act can be found here.