NGI The Weekly Gas Market Report
A group of Columbia Transmission shippers has called on FERC to grant emergency relief on an expedited basis to prevent the pipeline from unilaterally modifying the primary delivery points under their contracts while a complaint proceeding is pending.
In a complaint filed on June 6, Atmos Energy Marketing LLC, BP Energy Co., Delta Energy LLC, Hess Corp., Honda of America Manufacturing Inc., Integrys Energy Services Inc., Interstate Gas Supply Inc., National Energy Marketers Association, the Ohio Farm Bureau Federation and Sequent Energy Management LP charged that Columbia’s decision to unilaterally implement new primary delivery points without seeking permission from the Federal Energy Regulatory Commission (FERC) would be a violation of both the Natural Gas Action and the agency’s Section 284 regulations.
Specifically, the pipeline would be in violation of the NGA provision that requires all interstate pipelines to include within their tariffs the terms and conditions relevant to jurisdictional services, the shippers said. It also would be in violation of regulations that require pipelines to seek authorization prior to amending their tariffs, and which establish flexible receipt and delivery point requirements, they claimed.
The Columbia pipeline plans to implement the new primary delivery points “through actions that will not be reflected in its tariff, and for which it does not intend to seek approval” from the Federal Energy Regulatory Commission, the Columbia shippers said. Although the new primary points would not become effective until Nov. 1, Columbia’s firm shippers would be required to request new primary delivery points and transfer their contract quantities by July 31. “Columbia shippers believe that the time remaining between now and July 31 is inadequate,” they said.
“Columbia would increase the number of primary delivery points on its system from 255 to 371, an increase of 116 delivery points. In practical terms, this increase means that firm shippers that schedule gas to a single primary point under a current contract will henceforth be required to schedule to as many as 10 different delivery points,” the shipper group told FERC.
On June 5, Columbia filed “a belated, eleventh-hour proposed tariff modification…that purports to ‘clarify’ the tariff in a manner that would treat primary delivery points, a critical provision of Columbia’s service agreements, as entirely discretionary, thereby abrogating currently effective service agreements. Moreover, the tariff filing, which appears to intentionally mask the magnitude of the changes Columbia intends to implement, would severely restrict service flexibility. Tellingly, the very fact of Columbia’s last-minute tariff filing concedes a basic issue raised in this complaint: Columbia cannot revise its services, leave aside its contracts, without seeking authority to modify its tariff” at FERC, the shippers said.
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