CenterPoint Energy Gas Transmission on Friday got its third extension of a FERC deadline to justify why it should not be stripped of its ability to enter into negotiated-rate contracts with transportation customers.
FERC issued a show-cause order against CenterPoint Energy in mid-September after agency staff found that the pipeline had failed to inform the Commission of a slew of material deviations in its contracts over an almost six-year period (see NGI’s Daily Gas Price Index, Sept. 17).
CenterPoint Energy originally was ordered to respond on Oct. 10, but it requested and received extensions to Nov. 14 and then Dec. 15. The latest order buys the pipeline company an additional 31 days, moving the deadline to Jan. 15.
The company said the third extension was needed to give it and FERC’s enforcement staff “sufficient time” to carry out their settlement discussions and because of the “advent of the holiday season.”
Between Oct. 21, 1997 and April 1, 2003, a FERC staff audit found that CenterPoint Energy failed to report all of the non-conforming terms and conditions in 76 negotiated-rate contracts that still were in effect on or after Jan. 1 of this year. In addition, staff discovered that the pipeline had failed to post the information on the Internet.
If the Commission should decide to strip CenterPoint Energy of its negotiated-rate authority, it would mark the second such action by the agency. In July 2002, it suspended for a year Transwestern Pipeline Co.’s authority to negotiate rates based on basis differentials because transportation customers were overcharged during the California energy crisis in 2000-2001 (see NGI’s Daily Gas Price Index, July 18, 2002).
CenterPoint Energy is accused of violating FERC regulations which require any contract or executed service agreement that “deviates in any material aspect from the form of service agreement in the pipeline’s tariff” to be filed with the Commission.
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