The US Federal Energy Regulatory Commission (FERC) has unveiled a sweeping proposal to reform its long‑standing blanket certificate program, a move aimed at accelerating the development of US natural gas infrastructure while updating regulatory thresholds that have remained largely unchanged for two decades.
The proposal, issued as a Notice of Proposed Rulemaking (NOPR), would significantly expand the scope of projects that interstate pipeline operators can undertake without seeking case‑specific approval. FERC officials said the changes are designed to streamline permitting, reduce regulatory burdens, and better align the program with modern construction costs and system needs.
At the center of the proposal is a substantial increase in the cost limits that determine whether a project qualifies for blanket authorization. FERC is proposing to raise the automatic authorization threshold from roughly US$14.5 million to US$30 million and increase the prior‑notice threshold from about US$41.1 million to US$86 million. Storage-related project limits would also more than double. These changes reflect the sharp rise in pipeline construction costs since the last major revision in 2006, with agency staff noting that real-world costs have increased far more quickly than the index currently used to adjust the caps.
Beyond cost adjustments, the proposal would broaden the categories of infrastructure eligible for streamlined approval. More upgrades and expansions to existing systems — including compressor station modifications, receipt and delivery point changes, and certain mainline improvements — would be eligible for blanket treatment. In some cases, FERC is considering eliminating cost limits altogether, particularly for in‑fence expansions of existing compressor facilities under prior‑notice procedures.
The rulemaking also includes technical changes intended to modernize how the program operates. FERC proposes replacing the current inflation index with the Handy‑Whitman Index, which more closely tracks pipeline construction costs, and extending the typical in‑service deadline for qualifying projects from one year to two. Additional revisions would provide greater flexibility for abandoning facilities and streamline lifecycle management of existing assets.
While the proposal focuses on reducing regulatory friction, FERC has included measures aimed at maintaining protections for customers. FERC would allow pipelines to charge incremental rates for certain projects authorized under the prior‑notice process, ensuring that only customers who benefit from expansions bear the associated costs. Companies would also be required to disclose the purpose and beneficiaries of projects and, in some cases, demonstrate that existing customers benefit from proposed expansions.
The proposal will now go through a public comment period, during which industry stakeholders and other parties can submit feedback and reply comments for FERC to consider. After reviewing the record, FERC may revise the proposal and ultimately issue a final rule, which would take effect after publication in the Federal Register.
