Fearing the potential side effects of waivers on the interstatemarket, FERC last week decided to give Atlanta Gas Light (AGL) onlya short-term extension of its waivers to Commission regulations topreserve the “status quo” of retail gas unbundling in Georgia whileit explores other non-waiver solutions for utilities.

The Commission restricted the Atlanta, GA-based utility to a17-month extension of the existing experimental waivers andlimited jurisdiction blanket certificate, which are due to expirein October, in an attempt to wean AGL away from its growingdependency on them. AGL had asked for a waiver extension of aboutthree and a half years.

But FERC cited concerns about the effect that granting such along-term extension would have on the interstate pipeline market.”In addition, if we were to extend the waiver for 3.5 years, it isunclear that this would be Atlanta’s final request for a waiver ofthe capacity-release regulations. In fact, all indicators suggestotherwise,” the draft order said [RP98-206-005].

AGL had asked FERC to extend a waiver that enables it to makeconsecutive monthly prearranged releases to marketers of Part 284capacity obtained at a discount from Southern Natural Gas. Theutility had sought to apply the waiver to other pipelines, but FERCsaid no. The utility also sought a continuance of the waiver of theCommission’s “shipper-must-have-title” policy so AGL could allocateinterstate capacity to marketers under its Incremental BundledStorage Service (IBSS). Existing waivers, which were granted in1998, were for one year only.

The Commission said it allowed short-term waivers because itrecognized “denial of extension of the waivershipper-must-have-title policy would likely require an immediaterestructuring of the Georgia retail unbundling program or, at aminimum, could cause parties hardship in continuing to proceedunder the state unbundling program…”

FERC ordered staff to convene a technical conference to explorewaiver alternatives, as well as the effect of waivers and AGL’sunbundling program on the interstate market.

The Commission recognized AGL’s need for waivers was directlytied to its holding of Part 157 capacity on upstream pipelines, andits inability to convert such capacity to Part 284. Staff shouldexplore at the conference “the possibility of conversion of theupstream contracts to Part 284 contracts.” It also directed severalpipelines with which AGL has Part 157 contracts – such as SouthernNatural Gas, Transcontinental Gas Pipe Line, South Georgia NaturalGas, ANR Pipeline and Great Lakes Gas Transmission – to participatein the conference. No date has been set.

“The parties should determine whether changes could be made tothe upstream pipelines’ tariffs or operations that would eitherpermit the conversion, or otherwise allow Atlanta to avoid the needfor the IBSS rate schedule and the waiver of theshipper-must-have-title rule,” the draft order said.

Separately, the Commission awarded Baltimore Gas and Electric(BG&E) a limited, 12-month waiver of theshipper-must-have-title regulation in order to carry out anexpanded retail unbundling program in Maryland [RP99-355]. Theutility has sought a waiver of 17 months.

Susan Parker

©Copyright 1999 Intelligence Press, Inc. All rightsreserved. The preceding news report may not be republished orredistributed in whole or in part without prior written consent ofIntelligence Press, Inc.