Piedmont Natural Gas has reached a settlement in principle with the North Carolina attorney general’s office over the utility’s rate mechanism. North Carolina agreed to drop its appeal of the rate mechanism, and Piedmont agreed to share with its customers a portion of what is recovered through the mechanism, which could return up to $1.5 million a year to its customers through Oct. 31, 2008. The Charlotte, NC-based utility’s Customer Utilization Tracker (CUT) was approved and adopted in a 2005 rate case before the North Carolina Utilities Commission (NCUC). It separated the collection of utility margin from customer volumes, which vary depending on prevailing weather conditions, appliance efficiencies and customer conservation practices. The portion of funds to be shared with customers would be applied equally to the development of new conservation programs by Piedmont in consultation with the NCUC Public Staff and the attorney general’s office and to the reduction of rate increases associated with the CUT mechanism. Piedmont distributes natural gas to 990,000 residential, commercial and industrial utility customers in North Carolina, South Carolina and Tennessee, including 61,000 customers served by municipalities that are wholesale customers.

Dallas-based Energy Transfer Partners LP said improved operating results from its core natural gas pipeline assets in Texas will lead to higher-than-expected earnings in fiscal 2006. The partnership upped its expectations for the year to $730 million from $710 million. Because of adjusted income from discontinued operations a year ago, Energy Transfer reported 3Q2006 income for the period ending May 31 was $111.9 million, compared with $189.5 million in 3Q2005. Earnings in 3Q2005 included a $143 million gain from discontinued operations. Earnings before interest, taxes, depreciation and amortization (EBITDA), adjusted for 3Q2006 were up 38% to $145.6 million versus $105.3 million a year earlier. In its transportation and storage business, Energy Transfer sold 1.303 billion Btu/d of gas, compared with 1.547 billion Btu/d in 3Q2005. It transported 4.797 billion Btu/d of gas, compared with 3.488 billion Btu/d of gas in 3Q2005. The partnership’s midstream business sold 1.2 billion Btu/d for the quarter, compared with 1.499 billion Btu/d a year earlier. The partnership’s gas transportation and storage operations now include 11,700 miles of pipelines in Texas and Louisiana and three Texas-based gas storage facilities. Another 550 miles of pipe are under construction in Texas. Earlier this year, the partnership approved a $360 million pipeline expansion project to transport increased gas production in East and North Texas (see NGI, May 8). And in June, Energy Transfer partnered with Boardwalk Pipeline Partners LP and ONEOK Partners LP to construct a 560-mile pipe to carry 1 Bcf/d through Oklahoma and Arkansas that will interconnect with Texas Gas Transmission LLC in Cohoma County, MS (see NGI, June 12).

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