The Federal Energy Regulatory Commission (FERC) today established a new index level to calculate annual changes for interstate oil pipeline rate ceilings for 2021 through 2026.
After concluding its fifth five-year review of the index under Order No. 561, FERC set the new index level of Producer Price Index for Finished Goods plus 0.78 percent (PPI-FG+0.78%) for the five-year period from July 1, 2021, to June 30, 2026.
The Commission adopted the new index level after reviewing comments responding to a Notice of Inquiry (NOI) issued June 18, 2020, and the page 700 data from FERC Form No. 6, Annual Report of Oil Pipeline Companies.
FERC’s calculation of the index level includes, among other factors, adopting certain commenters’ proposals to adjust the data set to remove the effects of the Commission’s 2018 income tax policy change for Master Limited Partnership-owned pipelines, adopting certain commenters’ proposal to trim the data set to the middle 80 percent of cost changes and removing those pipelines that either did not provide FERC Form No. 6 page 700 data or provided incomplete data.
The Commission declined to adopt other proposed changes to the index calculation.