FERC has accepted pro forma tariff records submitted last year by Tallgrass Interstate Gas Transmission (TIGT) and requested the pipeline to file actual tariff records reflecting a series of conditions laid out by the regulators.

TIGT filed for a rate hike and postage-stamp rate treatment 15 months ago, citing reduced throughput due to shrinking Rocky Mountain-Midcontinent basis differentials, as well as modest prospects for market demand growth and competition from other pipelines "in virtually every market" [RP16-137]. The company also submitted pro forma tariff records to update the general terms and conditions and rate schedules of its Federal Energy Regulatory Commission gas tariff. Tallgrass proposed to modernize and re-organize its tariff for user-friendliness and to harmonize its provisions with other interstate natural gas pipelines.

Following motions filed by the Tallgrass Shippers Group and the City of Hastings, NE, in late 2015 and subsequent revisions to the proposed pro forma tariff records by TIGT, FERC in November approved TIGT's uncontested settlement that resolved all issues and, on Dec. 23, accepted tariff records that implemented the terms of that settlement.

FERC accepted TIGT's pro forma tariff records, subject to TIGT revising certain tariff records.

First, TIGT must filed revised tariff records that reflect changes it agreed to with Black Hills Utility Holdings Inc. in a joint response last month. Black Hills had sought clarification or revisions to several provisions of TIGT's proposed tariff records:

  • References to hourly flow requirements;
  • The threshold for metering errors;
  • Exempting non-electronic flow measurement delivery points from certain measurement provisions;
  • Maintaining scheduling priorities for human needs customers;
  • The creations of operational impact areas; and
  • Inclusion of vented gas in the definition of "lost and unaccounted for gas" in the general terms and conditions (GT&C).

FERC found "just and reasonable" TIGT's proposal to consolidate four sections of the current GT&C of its tariff, including curtailment and scheduling principles, into section 4 (scheduling and curtailment priorities) of the GT&C of the proposed tariff. Black Hills had claimed "that Tallgrass' proposal relating to priority of service appears to depict Tallgrass as a throughput pipeline, rather than acknowledging the specific, unique circumstances of its customer base," and urged TIGT to retain its existing service priority protections to prioritize human needs customers, like Black Hills, during curtailment conditions."

FERC also found TIGT's proposed definition of operational impact areas (OIA) -- "the area(s) on Transporter's System, as identified on Transporter's Interactive Website, where imbalances have a similar operational effect" -- to be just and reasonable, if TIGT revises it "to clarify to Black Hills that it will have a single system-wide OIA."

Finally, FERC accepted TIGT's proposal to modify the definition of "lost and unaccounted-for gas" (LAUF) in section 1 of the GT&C, subject to TIGT deleting from it the phrase "gas vented." Black Hills had argued that TIGT had stated that vented gas is not used as a component of the computation of LAUF, but instead, vented gas volumes are recovered under the vented gas provision of the tariff.