NGI The Weekly Gas Market Report
Vectren Corp. announced that the Indiana Supreme Court hasoverturned an appeals court verdict and affirmed the Sept. 12, 1997order of the Indiana Utility Regulatory Commission (IURC), that thegas supply agreements between utilities Indiana Gas and CitizensGas and Coke and their joint venture marketing affiliate, ProLianceEnergy, are in the public interest.
The IURC’s decision stated that the agreements between ProLianceand the utilities were reasonable, and that customers wereexperiencing significant gas cost savings under them.
“One of the principal reasons for the creation of ProLiance wasto obtain gas cost savings for customers that were otherwiseunobtainable. Since its inception, ProLiance has saved thecustomers of Citizens Gas and Indiana Gas over $60 million in gascosts. We are very pleased with the court’s decision because itwill preserve these benefits for our customers. Having ended theuncertainty created by this legal challenge to ProLiance’sformation, it will be better able to grow and pursue furtherbusiness opportunities,” stated Niel C. Ellerbrook, CEO of Vectren,the parent company of Indiana Gas.
ProLiance Energy, an alliance between affiliates of Citizens Gas& Coke Utility and Indiana Gas Company, was formed as a gasmarketer to residential, commercial and industrial customers in1996. Despite protests from industrial customers and a citizensgroup, the IURC found in 1997 that ProLiance’s agreements were inthe public interest and in accordance with Indiana regulatory law.The industrials protested ProLiance’s control over 37 Bcf of theutilities’ working storage capacity and 600,000 Dth/d of their firmtransportation capacity. The Citizens Action Coalition claimed theunregulated affiliate was using the same offices and personnel asthe regulated utilities. The Coalition and an Indiana appeals courtfound fault with ProLiance’s sale of gas to the utilities at indexprices. The appeals court, however, did not address the question ofeconomic value and overall public interest.
“Now that the Supreme Court has rendered its decision, we willendeavor to discuss any remaining issues with the Office of UtilityConsumer Counselor and other interested parties with the hope ofreaching an agreement that can be presented to the IURC for reviewand approval,” said Ellerbrook.
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