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FERC last week changed its tune and cleared the way for NorthernNatural Gas to acquire off-system, interruptible capacity fromthird-party pipelines. On rehearing of a July order, the Commissionfound that since Northern Natural sought the IT capacity to augmentits own operations, rather than for the purpose of re-marketing it,its request did not raise the concerns cited in a 1997 TexasEastern Transmission case. There, FERC feared that third-partypurchases could lead to preferential treatment for purchasingpipelines and could limit the capacity choices of other customerson third-party systems.

Surprising even itself, Consumers Energy announced last weekthat in only eight months of the Gas Customer Choice program,100,000 of its customers switched to an alternate supplier,reaching the limit for the first year of the plan. Out of the 10suppliers vying for Consumers’ market, Sempra Energy affiliateEnergy America-Michigan topped the list by signing 90% of theenrollments, a Michigan Public Service Commission (MPSC)spokesperson said.

Peoples Energy Chairman Richard E. Terry indicated last week hiscompany was talking with potential partners about building analternative pipeline project that would extend from the Chicago hubto serve the southern Wisconsin market.

Giving gas unbundling efforts in California a shot in the arm,FERC last week approved a major agreement to restructure thelong-term transportation and gas sales arrangements that haveenabled Southern California Gas (SoCalGas) over the years toreceive imports of Canadian gas through its paper pipelineaffiliate, Pacific Interstate Transmission Co. (PITCO).

FERC last week proposed a rulemaking that would update theexisting consensus standards of the Gas Industry Standards Board(GISB) with respect to confirmation practices, standardization ofinformation on pipeline Internet web sites and electronic datasets[RM96-1-011].

FERC last week rejected a proposed service agreement in whichColumbia Gulf Transmission tried to push the envelope too far bynegotiating terms and conditions of service with one of itscustomers, Entergy Louisiana Inc. (ELI)

SaskEnergy and Enbridge Consumers Gas last week dropped out ofthe competition for a distribution franchise in Nova Scotia once itbecame clear the provincial government would allow industrialcustomers to apply for direct connections to the Maritimes andNortheast Pipeline. Their departure leaves only Sempra Atlantic Gasand Maritimes NRG competing for province-wide distributionfranchise rights and seven small municipal agencies competing forsite-specific franchises.

SaskEnergy and Enbridge Consumers Gas last week dropped out ofthe competition for a distribution franchise in Nova Scotia once itbecame clear the provincial government would allow industrialcustomers to apply for direct connections to the Maritimes andNortheast Pipeline. Their departure leaves only Sempra Atlantic Gasand Maritimes NRG competing for province-wide distributionfranchise rights and seven small municipal agencies competing forsite-specific franchises.

Consolidation continued last week among Massachusetts utilities, this time with an electric planning to buy a combination utility in a move that follows the maxim that bigger is better in a deregulated market. Boston Edison parent BEC Energy and Cambridge, MA-based gas and power holding company Commonwealth Energy System plan to merge in a cash and stock deal.