Federal Power Commission v. Moss

Background

A federal agency that oversees interstate natural gas (the Federal Power Commission, or FPC) adopted Order No. 455 to speed development of new gas supplies. The rule let producers get a permanent certificate to sell new gas and, in some cases, include a promise allowing the producer to stop sales at a known future date ("pregranted abandonment"). Producers wanted certainty about rates so they would commit gas to the interstate market. A court of appeals struck down the pregranted abandonment part of the rule, and the FPC asked the Supreme Court to review that ruling.

Reasoning

The Court addressed whether the FPC may both approve a sale and authorize abandonment at a future date when it finds that present or future public convenience or necessity allows it. The Court held that the statute does not fix the timing of the FPC’s finding and that Congress left that timing to the agency’s discretion. The Court said forecasting future needs and granting an advance abandonment in appropriate cases falls within the FPC’s authority, so long as the agency makes proper findings and decisions can be reviewed by courts.

Real world impact

The decision leaves the FPC able to offer an optional procedure that can reduce rate uncertainty and encourage exploration by giving producers predictable terms. It does not automatically approve any particular abandonment; each authorization must rest on adequate agency findings and remains subject to judicial review. The case was sent back to the lower court for further proceedings consistent with the opinion.

Dissents or concurrances

A concurring Justice agreed with the result but warned that letting a producer alone decide whether to quit service may lessen regulatory control and raise consumer concerns.