The financial and operational impacts of FERC Order 636 on the interstate natural gas pipeline industry
Abbreviated Journal Title
J. Regul. Econ.
gas pipeline; expense preference; regulation; EXPENSE-PREFERENCE BEHAVIOR; ELECTRIC UTILITIES; OPEN-ACCESS; EFFICIENCY; MANAGEMENT; SAVINGS; MARKET; FIRMS; COSTS; Economics
The Federal Energy Regulatory Commission's Order 636 fundamentally altered the regulatory and operational environment of the natural gas industry in 1992, as the culmination of several directives aimed at relaxing regulation and fostering competition. We hypothesize that gas pipeline firms subsequently changed their operational and financial behavior in ways consistent with reduced balkanization, increased competition, and reduced expense preference behavior. Our results indicate that these firms have become more homogeneous financially but less so operationally We find evidence that the marginal profitability of various pipeline activities has responded more to financial market conditions than to the regulatory environment.
Journal of Regulatory Economics
"The financial and operational impacts of FERC Order 636 on the interstate natural gas pipeline industry" (2004). Faculty Bibliography 2000s. 4348.