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FERC's Gas Options Plan Elusive

FERC's Gas Options Plan Elusive

As of last Friday, 35 days away from the Federal Energy Regulatory Commission's August recess and counting....there was still no official sign of its promised plan to cure the gas market of its ills. But rumors abounded that the alleged "gas options" paper has been circulated to pipelines and producers and is undergoing a variety of alterations. There also was one report that the plan might not after all see daylight until after the recess.

Reportedly some of the key elements include eliminating the rules for 30-day transactions, the ceiling prices on released capacity and pre-arranged transactions. Everything would be posted for bidding which should establish a market value for capacity. Another element would allow the pipeline to recover the difference between the market value of capacity and its rates as transition costs which would be flowed through to customers.

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