After a lengthy back and forth process, the Federal Energy Regulatory Commission issued an order last week approving an agreement between Commission staff and CenterPoint Energy Gas Transmission Company (CEGT) that effectively clears up alleged violations in a Show Cause Order issued by the Commission on Sept. 15, 2003.

The Show Cause Order resulted from a staff investigation that determined that the interstate pipeline arm of CenterPoint Energy had failed to inform the Commission of a slew of material deviations in its pipe contracts over an almost six-year period (see Daily GPI, Sept. 17, 2003; Dec. 15, 2003).

In approving the settlement, FERC said it finds that “the Agreement provides an equitable resolution of this matter and is in the public interest.”

The Sept. 15 Show Cause Order required CEGT to show cause why the fact that it failed to report and post all of the non-conforming terms and conditions in its negotiated rate contracts does not violate Section 4 of the Natural Gas Act (NGA), numerous sections of the Commission’s regulations and the Commission’s April 25, 1996 and October 2, 1996 orders granting CEGT’s predecessor, NorAm Gas Transmission Co. the authority to enter into negotiated rate contracts.

Under the agreed upon and approved settlement, CEGT must:

The case concerned CEGT’s compliance with the reporting and posting requirements for non-conforming terms and conditions in 70 negotiated rate contracts that CEGT entered into between Oct. 31, 1997 and April 1, 2003, and which were in effect, and not pending before the Commission, after Jan. 1, 2001. In the agreement, enforcement states CEGT violated the NGA and the Commission’s regulations.

In resolving the matter, CEGT neither admitted nor denied that its actions violated any provision of the NGA or the Commission’s regulations.

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