The New York Public Service Commission yesterday directednatural gas utilities to take several measures to improve supplyreliability this winter for interruptible customers, and setrequirements for marketers to have firm transmission pipelinecapacity from November through March.

Calling a repetition of last winter’s problems “unacceptable,”NY PSC Chair Maureen O. Helmer said “after a series of warmwinters, many interruptible gas customers in New York assumed thatfuels would be available at reasonable prices on demand. Two weeksof cold weather last winter forced unprepared interruptiblecustomers to either remain on utility systems or to attempt topurchase alternate fuel supplies on the spot market in competitionwith other consumers, affecting natural gas supplies and prices.”

Because changes in oil suppliers’ inventory practices have addedmore risks to fuel oil availability at all times, the commissionvoted to require that alternate fuels be on site at the start ofthe winter season. The commission also approved a three-partstrategy to be implemented this fall by local gas utilities. Themeasures are designed to ensure that the interruptible gascustomers are in fact, interruptible, that is, that they areprepared to be interrupted, and that they have other optionsavailable.

The utilities will be required to ensure that these customersare prepared to leave the gas system during times when demandpeaks, and thus provide a level of reliability for all gascustomers. Each utility will be required to do the following:ensure that its interruptible customers have the equivalent, eitherthrough storage or some other arrangements, of a minimum seven- to10-day supply of alternate fuel by Oct. 1, depending on theutility’s interruptible criteria; implement a plan to checkcompliance with interruptible customer requirements; and establisha higher rate for natural gas service for those interruptiblecustomers found to not be in compliance with the rules.

The NY PSC stressed that the storage supply does not mean thatfacilities have to construct new storage areas. Rather, thecustomers have to provide evidence that they can meet therequirement in an equivalent manner. Those customers also will beon notice that they have to be prepared to meet interruptions thatcould be longer than the minimum standard set by the commission.

The marketers’ rules were set to ensure that they would be ableto deliver gas to their customers without any interruption inservice during critical winter months. In approving the marketers’rules, the commission adopted a set of procedures designed toensure compliance.

Utilities affected by the commission’s action include CentralHudson Gas & Electric, Consolidated Edison of New York, KeySpanEnergy Delivery, National Fuel Gas., New York State Electric andGas, Orange and Rockland Utilities, and Niagara Mohawk Power.

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