โ Scribed by Randolph, Kenneth E.
No coin nor oath required. For personal study only.
Over the last six years, FERC has promoted and encouraged a regulatory environment wherein the pipeline merchant and all other competing gas merchants (Le., producers and marketers) compete with each other for sales. For instance, the commission has ruled that before a pipeline can obtain a gas inventory charge or a producer demand charge or any other type of deregulated merchant function, it must first demonstrate that the quality of its firm transportation service is comparable to the quality of its firm sales service.
Implementation of comparability allows producers and marketers to use m y their gas supply and market aggregation abilities as well as their ability to arrange for the leastcost transportation of gas to customers to compete with the pipeline merchant for long-term firm sales contracts. In 1990, substantial progress was made toward establishing regulatory policies that foster such a procompetitive environment, and additional progress will be made in 1991 as the commission will be able to put behind it take-or-pay issues and old-gas issues and instead will be able to devote its efforts toward (1) expediting regulatory approvals for new pipeline construction; (2) issuing a notice of proposed rulemaking that addresses pipeline rate design, unbundling of services, comparability of services and the pipeline sales obligation; (3) the implementation of GICs and PDCs for individual pipelines; (4) the implementation of capacity brokering; and ( 5 ) LDC bypass.
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