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AGA Eyes Columbia as 'Tool' to Enact Negotiated Plan

AGA Eyes Columbia as 'Tool' to Enact Negotiated Plan

The proposal of Columbia Gas Transmission and Columbia Gulf Transmission calling for FERC to allow the negotiation of terms and conditions of pipeline services on their systems would provide a "useful implementation tool for enactment of a generic program," the American Gas Association says.

The LDC group noted it reached this conclusion when it compared the Columbia proposal to the negotiated "principles and procedures" that it and the Interstate Natural Gas Association of America (INGAA) espoused in a proposal submitted to the Commission in May. It believes FERC foremost should move ahead with a negotiated policy on a generic basis, and then it should use the Columbia pipelines as vehicles to carry out the program.

The Columbia proposal, which was submitted to FERC in June, falls short of the AGA plan in a couple of areas, AGA conceded, but it believes this can be ironed out. For example, Columbia's filing "fails to incorporate" AGA's two-step process, which calls for a pipeline to establish a high-quality recourse service by filing at FERC a benchmark for its recourse service, and to list the terms and conditions that would be non-negotiable.

"To the extent that this can be accomplished through an informal settlement-type process, filing of comments at FERC, or even through meetings between Columbia and its customers and amendment to the filing, this infirmity of the proposal can be overcome," AGA told FERC last week [RP98-249, RP98-250].

The fact that the Commission seems headed towards reforming its complaint procedures in a "timely manner" should bode well for the Columbia proposal as well, AGA said. It believes "Columbia's filing should continue to be given serious consideration as it has been filed on a prospective basis only." However, it emphasized that actual negotiated services shouldn't be allowed until an expedited complaint process is in place.

The AGA noted that Columbia deferred the issue of allocation of costs between customized and recourse services to its next general rate case. Although it also failed to address the same issue in its May proposal, the LDC group said it has been "very clear" in the past about its position on the issue - "that is, negotiated rates/services should not shift costs to recourse customers and costs must be properly allocated between recourse service and negotiated services."

Susan Parker

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