On December 7, 2018, the United States Court of Appeals for the Sixth Circuit (“Sixth Circuit”) affirmed the United States District Court for the Northern District of Ohio’s (“District Court”) granting of a preliminary injunction to Nexus Gas Transmission, LLC (“Nexus”).  The preliminary injunction will allow Nexus to exercise the right of eminent domain under the Natural Gas Act (“NGA”) to build an interstate natural gas pipeline through parts of Ohio and Michigan.  The Sixth Circuit held that the District Court did not abuse its discretion in balancing the preliminary injunction factors and in refusing to allow an evidentiary hearing on the issue.
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On November 26, 2018, FERC partially granted the California Independent System Operator Corp. (“CAISO”) a temporary extension of two sets of tariff provisions concerning natural gas system limitations on CAISO’s system and corresponding market operations.  While FERC temporarily extended six tariff provisions related to the Aliso Canyon gas storage facility (“Aliso Canyon”) effective November 30, 2018, and December 16, 2018, as requested, it rejected CAISO’s proposal to temporarily extend the tariff revisions regarding gas price scalars.
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On October 11, 2018, twenty-six pipelines submitted filings in compliance with Order No. 849 in response to a directive from FERC concerning the effect of reduced corporate income taxes on pipelines. Order No. 849 established a staggered filing schedule, so pipelines have between 28 and 84 days to submit “FERC Form No. 501-G,” depending on how FERC assigned the pipelines. The pipelines in the first category were required to file Form No. 501-G along with other information to inform FERC and the public of the impact of the recent reduction in federal income tax rates, as well as the effect of the Commission’s policy on the collection of federal income taxes by tax pass-through entities, on their revenue requirements. 
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On September 21, 2018, the United States Court of Appeals for the District of Columbia Circuit (“D.C. Circuit”) ruled that FERC’s order to deny ANR Storage Company’s (“ANR”) request to charge market-based rates was arbitrary and capricious.  The D.C. Circuit found that FERC provided no basis for treating ANR differently from another competitor, DTE Energy Company (“DTE”) in a prior decision, and that FERC’s explanation for why intrastate facilities could not restrain ANR’s exercise of market power was internally inconsistent.  As such, the D.C. Circuit remanded the proceeding back to FERC.
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On September 4, 2018, the United States Court of Appeals for the Third Circuit (“Third Circuit”) declined to review Pennsylvania’s water permit approval of Transcontinental Gas Pipe Line Company’s (“Transco”) Atlantic Sunrise Project.  The Third Circuit ruled that it had jurisdiction to hear the state agency’s certificate decision on appeal even though the certificate decision was simultaneously being appealed to another Pennsylvania agency.
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On September 5, 2018, the United States Court of Appeals for the Third Circuit (“Third Circuit” or “Court”) found that FERC did not violate federal law when approving Transcontinental Pipe Line Company, LLC’s (“Transco”) Garden State Expansion Project (“Project”).  The Third Circuit did, however, determine that the New Jersey Department of Environmental Protection (“NJDEP”) improperly denied requests for adjudicatory hearings on the issuance of various permits for the Project because the NJDEP misinterpreted the Natural Gas Act (“NGA”).  As such, the Third Circuit remanded back the permit issue so that NJDEP could reconsider those requests.
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On July 25, 2018, the U.S. Court of Appeals for the Fourth Circuit (“Fourth Circuit”) affirmed the U.S. District Court for the Western District of Virginia’s (“District Court”) opinion rejecting landowners’ constitutional challenge provisions of the Natural Gas Act (“NGA”) regarding the natural gas pipeline certificate process.  Specifically, the Fourth Circuit agreed that the District Court lacked jurisdiction to review the complaint, finding that Congress intended the complaint to be brought before FERC instead.
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On July 18, 2018, FERC affirmed its Revised Policy Statement on Treatment of Income Taxes (“Revised Policy Statement”), where FERC stated that it will generally not permit master-limited partnerships (“MLPs”) to recover income tax allowance in their cost of service.  In doing so, FERC dismissed requests for clarification and rehearing of its Revised Policy Statement, reiterating that tax pass-through entities (including MLPs) that recover an income tax allowance in addition to a return on equity (“ROE”) based on the discounted cash flow (“DCF”) methodology double recover investors’ tax costs.  FERC did however explain that while pass-through entities may eliminate previously-accumulated sums of accumulated deferred income tax (“ADIT”) from their cost of service, they did not need to refund those ADIT balances to ratepayers. 
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