A new Federal Energy Regulatory Commission (FERC) order in the restructuring proceeding for Natural Gas Pipeline Co. of America (NGP) suggests how the Commission will handle evolving issues in natural gas decontracting (Docket Nos. RP95-326-000).
NGP had asked to implement its compliance rates for new services in conjunction with a deferred-cost mechanism, allowing it to defer collection of revenue shortfall it allegedly would experience under those rates. The FERC recognized NGP's request as an effort to resolve a twofold problem on its system: First, NGP may be left with 600,000 MMBtu per day of unsubscribed capacity due to changes in contract levels and paths when its new contracts take effect on December 1. Second, to retain firm customers, NGP must offer many deep discounts on its firm reservation charge. As a result, a few customers end up paying the maximum rate.