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Pacific Gas & Electric Co. v. Federal Power Commission

United States Court of Appeals for the District of Columbia Circuit
506 F.2d 33 (1974)


In response to national natural-gas shortages in the early 1970s, in 1971 the Federal Power Commission (FPC) (defendant) ordered natural-gas suppliers to submit curtailment plans outlining their delivery priorities. Natural-gas suppliers submitted curtailment plans with a wide variety of rationing strategies. To provide uniformity and greater certainty, in 1973 the FPC issued Order No. 467, which set delivery priorities for natural-gas suppliers. The FPC called Order No. 467 a “Statement of Policy.” Under the Administrative Procedure Act (APA), 5 U.S.C. § 553, prior to adopting a new rule, federal agencies must publish notice of the rule and then allow public comment. Under § 553(b)(A), agencies could forgo this notice-and-comment proceeding only if promulgating general statements of policy. Pacific Gas & Electric Co. (PG&E) and other natural-gas pipeline customers (plaintiffs) were negatively affected by Order No. 467’s prioritization. PG&E sued the FPC, claiming that Order No. 467 was in effect a rule, not merely a policy statement, and so was invalid for failing to comply with the APA’s rulemaking procedures.

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