Texas Eastern Transmission (TETCO) has come up with a novel wayof solving its capacity turnback problem with a service providingfirm hourly flexibility, but customers, particularly New EnglandLDCs, aren’t buying it.

The tariff modification Texas Eastern proposes would allowshippers under Rate Schedules CDS, FT-1, SCT and SS-1 to take up to110% of 1/24th of their scheduled quantities for six hours on anyday. Providing this ability to vary takes on an hourly basis duringthe day will mitigate the issuance of OFOs requiring uniform hourlytakes this winter, Texas Eastern says. (RP00-543) The service hasbeen proposed on an experimental, interim basis, to be evaluated inMay.

To provide this flexibility TETCO would buy back from itself130,000 Dth/d of spare capacity on its system to, in effect,provide an on-system storage service. In order to pay for thecapacity the pipeline would eliminate the storage cost credit dueother customers under Rate Schedules SS-1, FSS-1, SS and X-28.

“Texas Eastern is trying to recover $6.1 million in costsassociated with unsubscribed capacity from its customers throughelimination of the storage cost credit – even though the shippersreceiving the credit are not the same shippers that will receivethe hourly flexibility,” New England LDCs said in a protest filedat FERC Sept. 27. The New England shippers said they would lose$1.5 million per year in storage cost credits and receive nobenefits from the new service.

Although Texas Eastern said the proposal had been made at therequest of its customers, the LDCs said they had objected to theplan when it was originally proposed last Spring, and the ProcessGas Consumers said they had never seen it. PGC said the serviceconstitutes a tariff change, which should be considered in thepipeline’s Order 637 compliance filing. The industrial users pointout that since TETCO’s current hourly flow provisions to notexplicitly state a shipper’s hourly flow rights, the new servicewould effectively restrict those rights and therefore constitutes adegradation of service.

PGC also said it does not appear the service will eliminate thepotential for a repeat of the numerous OFOs that TETCO issued lastJanuary, “rather it would provide additional flexibility for acertain class of shippers in the event TETCO calls an OFO.”

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