ABSTRACT
Since its inception by Supreme Court decree in 1954,1 the regulation of prices at the gas wellhead by the Federal Power Commission (FPC) has been “welfare” policy in the sense of redistributing income. As with local rent controls or maximum charges for medical services paid for by the state, gas price restrictions were to “keep prices down for the consumer.” Problems were encountered because of the large number of sources of supply of gas reserves, not because a few firms were able to restrict supply. The attention of the FPC centered on holding the price line on hundreds of transactions for differing qualities of gas sold by different producers to almost as many industrial buyers, local retail gas utili ties, orlong-distance interstate pipelines. The regulatory problem of first priority has been to find uniform price ceilings that would apply equitably to heterogeneous sellers and buyers.
