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Changing of the Guard at GISB May Signal Change in Direction

Changing of the Guard at GISB May Signal Change in Direction

The leadership of the Gas Industry Standards Board's (GISB) top decision-making committee has been in the hands of the pipelines and producers for a number of years, but the gavel has been passed to service companies and distributors in 1999. This changing of the guard has left some feeling uneasy as they wonder whether a radical change in direction is in store for the standards-setting group in the year ahead.

There will be "a different flavor to the leadership," conceded Jim Buccigross, counsel for software provider TransCapacity and the new chairman of GISB's 25-member executive committee. "This is the first time in a while that the services and LDCs have led," he said, but he doesn't anticipate a "fundamental change" in direction as a result.

In fact, Buccigross doubts his style of leadership will be that much different from his predecessor Michael Bray, who stepped down as head of the GISB committee due to his decision to retire from Duke Energy. "Like Bray, I hope to be able to bring people to the table on issues." Michael Novak, assistant general manager of National Fuel Gas Distribution, will be second-in-command on the panel. He replaces Jerry Hahn, who retired from Texaco Natural Gas.

Buccigross sees some plusses to a service company chairing the committee that develops standards for the gas industry and sets GISB priorities. "We have strong feelings sometimes on which way things should go," but - unlike the various gas industry segments - "we're not necessarily locked into [specific] positions by our economics..." As a service company, "we have to understand all of the various segments' concerns," he said. In the end, "clarity" of new standards is most important.

At the same time, however, Buccigross believes the job may be a "little more difficult" in some respects simply because he and Novak are new and represent different sectors of the gas industry. Some GISB members undoubtedly will wonder "who the [heck] are these guys, where are they coming from," he said in an interview with NGI.

In the upcoming year, the new chairman sees the organization "continuing" its development of standards for electronic bulletin boards (EBBs) that are accessed via the Internet. The executive committee already has passed standards on "the infrastructure [the type of connection and look of the main screen] and nominations part," which are due to be ratified by GISB members within a few weeks and implemented next September. "We will continue to set standards on flowing gas, invoicing and capacity release."

Other issues that the group hopes to set standards on in 1999 are imbalance netting and trading, cross-contract ranking, long-term purchase and sales contracts, and operational flow orders (OFOs) and critical notices, Buccigross said. He doesn't expect any of the issues to trigger the same level of controversy that surrounded the debate over intra-day nominations and title-transfer tracking. "Certainly there'll be some compromise and give-and-take from the various segments of the industry, but I don't see any of these being lightning rod issues."

Nevertheless, there is one issue - the development of standards for FERC's capacity-auction proposal - that could cause some heartburn for Buccigross and others in GISB. He conceded the standards organization is deeply divided on this issue, with the opposition insisting it is a policy issue that GISB should stay clear of in 1999. But "depending on what the Commission does, they [the executive committee] may" have no other choice than to take it up. FERC hasn't asked GISB to address the matter yet, but he isn't ruling out the possibility.

Buccigross believes the gas industry would prefer GISB to assume some kind of role in the issue. "Realistically...if the FERC says 'we want to come up with some regulations and we'd like GISB to do it [the standards],' kind of pragmatically people in the industry would rather have a say in that and would rather have it through GISB as opposed to...where FERC comes down from the mountain and says 'here are the regulations.'"

That aside, Buccigross thinks the most important GISB development in the upcoming year will be standards for the EBB Internet. These will provide shippers with a "common look and feel" to the pipeline EBBs accessed via the Internet. Shippers who already are doing transactions on the EBB Internet complain that, without standards, "it looks so much different on Pipeline A than it looks on Pipeline B," he said.

In addition, such standards would "open up electronic communications to a whole new class of shippers - that being the low-volume kind of shipper" that can't justify the costs associated with an electronic data interchange (EDI) system, Buccigross said. While EDI is ideally suited for the large shippers that do a hundred or more nominations a day, the EBB Internet is made to order for smaller shippers that do "fewer than half a dozen" per day.

Developing a standardized long-term purchase and sales contract, similar to the standardized contract that exists for short-term transactions, also will top GISB's agenda in the upcoming year, he noted. Industry has been clamoring for a standardized format for long-term contracts since last year. Now that GISB has finalized the contentious title-transfer tracking and intra-day nominations issues, "maybe we'll have more time to be able to look at that."

GISB also plans to work on developing standards that would require pipelines to use the Internet to "broadcast" OFOs and critical notices directly to affected shippers, Buccigross noted. Shippers no longer would have to search through pipelines' EBBs for notices that might affect them, he said, but rather would be notified by electronic mail. For further convenience, the E-mail could be hooked up to a beeper or some other "real-time" system to alert shippers about OFOs when they're out of their offices. The GISB task force exploring the issue will meet for the first time later this month, but still "I believe that's something that can be accomplished this year."

Likewise, Buccigross has "every confidence" that standards for cross-contract ranking will be a reality by the end of the year. These would allow shippers that have "multiple contracts on a pipeline to rank their nominations, their gas flow across those contracts, so in a situation where there's not enough [capacity], they'll be able to say 'keep this one [contract] whole and have this take the swing."

He's equally optimistic about standards for the trading of imbalances by shippers on pipelines. "This will be standardized. They'll be datasets. You'll be able to do it electronically," Buccigross said. "So if I'm running a positive imbalance and you're running a negative imbalance, and it's coming to the end of the accounting period...we can come together and basically trade them so that in a perfect world we would both come up zero, but in reality we'll both be able to minimize our imbalances."

Susan Parker

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