FERC yesterday gave its endorsement to a transmission rateschedule proposed by Reliant Energy Gas Transmission that willenable the company to meet the hourly peaking needs of powergenerators. With this action, Reliant becomes the first gaspipeline capable of providing such service.

The Commission generally applauded the pipeline for proposing anhourly firm transportation service (HFT), pointing out that Reliantwas able to accomplish this within the context of its existing rateschedule and without resorting to special negotiated deals withindividual customers. It recommended that other gas pipelines useReliant’s proposal as a “model.”

Reliant’s HFT rate schedule was adapted from the pipeline’sexisting rate schedule for firm transportation (FT). The keydifference is that the minimum duration of service under HFT is onehour, compared to one day under its FT rate schedule. Other notabledifferences include the following: contracting for HFT service willbe done via the Internet, the maximum term of a service agreementwill be limited to 90 days, and service agreements cannot beentered into more than 30 days in advance of their effective dates.

The base rates for the HFT service include a reservation rate of$0.7323/Dth, not to exceed $5.8584/Dth of hourly contract demandover any day; a commodity rate of $0.0087/Dth; and an overrun rateof $0.7410/Dth.

Due to the short-term nature of the HFT service, Reliantproposed to resolve monthly imbalances “more stringently” than theway it does with other services. Specifically, it proposed that HFTshippers be permitted to net or trade monthly imbalance only withother HFT contracts. But the Commission took issue with thisrestriction.

“Because Reliant has not shown why the ‘intra-HFT’ limitation isappropriate for Rate Schedule HFT while it is not needed for anyother rate schedule, Reliant must eliminate it…..,” the ordersaid [RP99-282].

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