AGA, INGAA, EEI Lose Major Members; NGSA Plans a Comeback
The new millenium saw the loss of two major energy companies by
three national energy trade associations, the Interstate Natural
Gas Association of America (INGAA), the American Gas Association
(AGA), the Edison Electric Institute (EEI), while a fourth, the
Natural Gas Supply Association (NGSA), says it is poised for a
For Kinder Morgan Inc., which recently bought the financially
troubled KN Energy, dropping its membership in INGAA and other
energy-related associations is directed mainly at immediate budget
cuts. The company also closed its Washington office. Kinder Morgan
is "initiating a back-to-the-basics strategy in trying to return
the company to profitability. So for now we're not renewing most of
our [association] memberships," said a spokeswoman for that
company. "But we do plan to be a part of those in the future
For Sempra Energy, which left AGA, EEI, INGAA and the Pacific
Coast Gas Association, strategic direction, as much as
cost-savings, was the key driver in the $5 billion holding
company's decision. The move is expected to save Sempra several
million dollars annually in dues and expenses related to its
employees' participation. The San Diego-based parent of two of the
nation's largest distribution utilities, San Diego Gas and Electric
and Southern California Gas will rely more heavily on the company's
own Washington, DC, office for federal lobbying activities.
"It is not just the dollars; we came to the conclusion after
some hard deliberations that these particular associations didn't
fit for the future of the company," said Fred John, Sempra's senior
vice president, external affairs. He noted, however, that the
company will maintain its memberships in industry
research/technology development groups, Electric Power Research
Institute (EPRI), Gas Research Institute (GRI) and Institute of Gas
"We're trying to take more of a customer-focused approach, and
the new technologies are what we need to deal with the customers in
the changing environment that we are in," John said.
San Francisco-based PG&E Corp., another large
California-based combination utility holding company, last year
pulled out of EEI, but has remained in the other groups.
Sempra Energy is "one of our bigger members," said AGA spokesman
Daphne Magnuson, but she refused to reveal how much dues it had
paid during the past year. Without Sempra, it's estimated that AGA
will be $800,000 poorer in 2000, according to sources.
Magnuson said Sempra's departure from AGA "won't have an affect
on our operations" in 2000, because "we're doing more with less."
She noted the association has cut costs for next year by $1.75
million by moving into its D.C. headquarters and taking other
steps, while also not increasing members' dues. That would put the
association's budget for 2000 at just under $25 million, with about
$18 million coming from members' dues.
Sempra's and Kinder Morgan's pullout from INGAA in 2000 will
mean about $505,000 less in the pipeline group's coffers ---
$475,000 less from Kinder Morgan and $30,000 less from Sempra. "The
financial hit is not going to be great for us," said INGAA
spokeswoman Anne Roland, because certain association members have
agreed to make up some of the shortfall that will be caused by
Kinder Morgan's departure. INGAA member dues are based on a
pipeline company's revenues, and are capped at $475,000. The
association's budget in 2000 will be $5.2 million. INGAA now has 33
EEI spokesman Jim Owen refused to disclose the financial impact
that Sempra's departure will have on the electric association,
which represents investor-owned utilities.
Meanwhile, NGSA, a producers' group under new leadership after
its former president was convicted of embezzlement from the
association last year, is mounting a membership push.
"I actually expect to increase our membership [by] a few
companies," said NGSA's new President R. Skip Horvath.
"I don't have a target yet. We're still working on that. But
there are producers out there who have not been a part of NGSA, and
I think they might be interested in our services." He estimated the
group currently has "roughly" 20 producer-members, and that its
budget for 2000 will be below $2.5 million. "It's been that for
Susan Parker, Washington; Richard Nemec, Los Angeles