Describing Northern Natural Gas’ recent all-new approach torates as “innovative,” FERC yesterday gave the go-ahead for anexamination of its components as “a useful test case” accompanyingthe Commission’s generic regulatory review.

Northern Natural’s proposal (RP98-203-000 & 001) includesthe option of negotiated terms and conditions , seasonal firmcapacity, market-based rates, and decapping secondarytransportation rates in the field area, among other things.

The Commission refused protesters’ pleas for summary rejectionof the pipeline’s pro forma tariff sheets. FERC currently is”reevaluating its current policies and procedures regarding ratesfor short-term and long-term services, as well as negotiated termsand conditions under which service can be provided….Northern’sproposal can serve as a useful test case for the exploration anddevelopment of these issues while the Commission is examining themon a generic basis.” Setting a 15-month time period, FERC said therecord should be closed in 13 months, allowing two months for thejudge to issue the initial decision.

FERC accepted the filing of Northern’s tariff sheets, andsuspended them for the maximum five months, subject to refund. Itsplit the issues into those to be resolved between a technicalconference and the evidentiary hearing.

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