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FERC Stands Firm on ‘No Bump’ in Last Intra-day Nomination Cycle

A tariff filing by Gas Transmission Northwest (GTN) that would have allowed the TransCanada Corp. affiliate to bump interruptible shippers in favor of electric power shippers during the third intra-day cycle has been rejected by FERC.

The Federal Energy Regulatory Commission, which revised in 2015 the interstate natural gas nomination timeline to improve coordination of wholesale natural gas and electricity market scheduling, refused in the GTN order to further accommodate electric power markets [RP17-1075].

GTN owns and operates a natural gas pipeline system extending from the U.S./Canada border near Kingsgate, British Columbia, through Idaho, Washington and Oregon to the California boundary. The company sought in a Sept. 22 filing to implement rate schedule firm hourly service (FHS) and rate schedule interruptible hourly service (IHS) "to provide greater flexibility for shippers on firm as well as an interruptible basis."

According to the filing, GTN further proposed to modify its nomination requirements "to provide that an interruptible shipper may be bumped at any time during the gas day to permit an FHS shipper to use its firm capacity. To accommodate this, GTN requests waiver of North American Energy Standards Board (NAESB) Standard 1.3.2(v), which provides that an interruptible shipper may not be bumped during the Intraday 3 Nomination Cycle."

In an order issued Tuesday, FERC said it supports pipelines "developing new services to serve customers such as electric generators that may have different service needs. However, GTN's proposed modifications to its tariff cannot be accepted without waiving the so-called No-Bump Rule, which reflects the Commission's long-standing balancing of interests as a matter of policy."

The No-Bump Rule restricts firm shippers from bumping nominated and scheduled interruptible service during the last standard intraday nomination cycle of the Gas Day. FERC precedent supports rejecting the proposed modifications, according to the order.

The Natural Gas Supply Association (NGSA) and a trio of natural gas indicated shippers -- Anadarko Energy Services Co., Chevron USA Inc. and Shell Energy North America -- had opposed GTN's proposal, specifically protesting the requested No-Bump Rule waiver.

Preserving the No-Bump Rule for the last intraday cycle "is critical to market certainty during the nomination process," NGSA said in a FERC filing. "The No-Bump Rule guarantees that a bumped interruptible shipper will have the opportunity to renominate its bumped volumes and receive their scheduled gas during the business day. Without such assurance, most shippers would be much less inclined to use interruptible transportation service (IT), thereby diminishing the value of IT and eliminating the significant benefits it brings to many customers."

FERC revised the interstate natural gas nomination timeline in April 2015, adopting two proposals submitted by NAESB to revise the interstate natural gas nomination timeline and make conforming changes to their standards. FERC Order No. 809 moved the Timely Nomination Cycle deadline for scheduling gas transportation from 11:30 a.m. CCT to 1 p.m. CCT and added a third intraday nomination cycle during the gas operating day to help shippers adjust their scheduling to reflect changes in demand.

In the closing days before the revised transportation nominations schedule went into effect in 2016, FERC denied several requests for waivers to portions of the rule, while accepting some others.

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