Although stating several times the FERC-ordered changes to itsexisting capacity-allocation procedures weren’t “necessary orappropriate,” El Paso Natural Gas has proposed a new allocationscheme that would assign “pathed” and “non-pathed” rights for thedelivery of shippers’ gas to the California market.

The proposal “strikes a middle ground between the [method] inuse today and a rigorously pathed approach,” El Paso told theCommission. It believes the proposal is “an acceptable way torevise its capacity-allocation procedures, if a revision to thoseprocedures is actually necessary, appropriate and desired by ElPaso shippers.”

Under its proposal, El Paso said it would identify in its tariffthe “pathed” rights available to each firm shipper under theirtransportation agreement. Shippers would have the “right todesignate, in the daily scheduling process, whether [they] wanted anomination to be considered ‘pathed’ or ‘non-pathed’ for purposesof capacity allocation.

Firm shippers with primary rights will have two opportunitiesduring each scheduling cycle to be allocated system capacity aheadof the shippers using either alternative points or interruptibleservice. During first phase of the cycle, El Paso proposes toschedule only those firm transactions with “pathed” rights, whichwould entitle shippers to a particular path on El Paso’s system.Firm shippers who submit nominations using “non-pathed” rights(i.e. rights to system-wide receipt points as specified in theirtransportation agreements) would be scheduled during the secondphase.

Pathed rights would be assigned to firm shippers based on eachshipper’s contract demand (CD) or, for full-requirements shippers,the billing determinant (BD) agreed to in the 1996 settlementbetween El Paso and its customers. Aggregate pathed rights assignedto shippers would be based on the “physical forward-haultransportation capability of the El Paso system under normal, notoptimal, operating conditions.”

Pathed rights also would be allocated to the three blocks ofturned-back capacity established by the 1996 settlement. Volumesnot identified in the nomination process as “pathed” would betreated as “non-pathed” during capacity allocation.

El Paso’s new capacity-allocation proposal is in response to thesweeping review of the allocation, scheduling and poolingprocedures that FERC ordered on El Paso last November. TheCommission directed the pipeline to submit a detailed proposal tochange its current method of allocating capacity on a pro ratabasis, especially at its interconnection with SoCalGas at Topock,AZ.

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