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
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
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."