A last-minute protest by Scana Energy Marketing to a requestedwaiver by Atlanta Gas Light to allow assignment of some of itsupstream pipeline capacity as part of the Georgia unbundling planmay have been a factor in derailing FERC action last week.

AGL had requested approval of the waiver by June 15 to allow itsunbundling program to proceed on schedule. The item had been slatedfor a vote at the Federal Energy Regulatory Commission’s openmeeting May 10 but was dropped from the agenda at the last minute.Scana’s protest and request for a technical conference, filed June5, suggests the Commission should not lumber hastily into thesoon-to-be-completed state restructuring process. A waiver of thefederal agency’s Order 636 rules on assignment of upstream capacitycould affect unbundling plans in other states and the Commission’sgoal of a competitive and efficient market for natural gas, Scanasaid.

The marketer, an affiliate of South Carolina Electric & Gaswhich currently serves IT customers on AGL’s system, made clear itis not a fan of AGL’s proposal to allocate and assign all itsupstream capacity to marketers taking over the LDC’s firmresidential customers. The proposal “essentially takes AGL’supstream rights out of the competitive market,” and thwarts thedevelopment of a secondary market.

Allocation and assignment assures that the LDC will not be stuckwith stranded capacity and costs. But Scana said the stranded costsissue should be dealt with separately.

The Scana brief questioned why AGL had waited until so late inthe restructuring proceeding to request a waiver which “it knewmany months earlier would be necessary.” The Georgia Public ServiceCommission has promised a ruling on AGL’s restructuring plan byJune 26. A FERC waiver of the Order 636 capacity assignment rulesis needed only for a small portion of AGL’s upstream capacity. AScana attorney suggested it would be better to wait for the GeorgiaPublic Service Commission ruling to address any problems, ratherthan act in advance on a blanket waiver.

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