Natural Gas Pipeline Builders Grossly Overcharging Suppliers

The Federal Energy Regulatory Commission (FERC) has allowed natural gas pipeline builders to grossly overcharge client gas suppliers, with some companies achieving up to 35 percent returns on investment. This profiteering has led to an epidemic of unnecessary overbuilding, resulting in a 38 percent overcapacity in gas pipelines and 27 percent excess gas storage capacity. The overbuilding has translated into $179 billion in unnecessary investment, which is passed on to ratepayers. Meanwhile, the transition to renewable energy has the potential to produce cost savings, but FERC has consistently ignored blatant profiteering on fracked gas pipelines.

Key Takeaways:

• Natural gas pipeline builders are overcharging client gas suppliers, with some companies achieving up to 35 percent returns on investment.
• The overbuilding of gas pipelines has resulted in a 38 percent overcapacity in gas pipelines and 27 percent excess gas storage capacity.
• $179 billion in unnecessary investment has been made, which is passed on to ratepayers.
• FERC has rejected just two of over 400 pipeline proposals since 1999, ignoring blatant profiteering on fracked gas pipelines.
• Newly proposed pipelines are in conflict with state climate laws and are not economically necessary.
• The transition to renewable energy has the potential to produce cost savings for ratepayers.
• Oakley Shelton-Thomas, senior researcher at Food & Water Watch, has highlighted the egregious profiteering by pipeline companies.
• The New York Climate Leadership and Community Protection Act has undermined the medium- and long-term justification for more pipeline capacity.

Statistics:

• 19-43 percent: The growth in fracked gas-sourced power as a percentage of overall U.S. supply since 2005.
• 74 percent: The increase in consumer electricity costs during the same period.
• 38 percent: The overcapacity in gas pipelines countrywide.
• 27 percent: The excess gas storage capacity.
• $179 billion: The estimated unnecessary investment in gas pipelines.
• 1999: The year since which FERC has rejected just two pipeline proposals out of over 400 considered.
• 35 years: The minimum period FERC assumes pipelines will remain economically useful.

Sources:

• Food & Water Watch, "Industry Analysis: Natural Gas Pipeline Builders Grossly Overcharging Suppliers"
• New York Climate Leadership and Community Protection Act
• Original report: https://www.foodandwaterwatch.org/2025/07/17/industry-analysis-natural-gas-pipeline-builders-grossly-overcharging-suppliers/