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Penn. Updates Gas Transport Rules

Fortnightly Magazine - December 1996

The Pennsylvania Public Utility Commission (PUC) has adopted new rules for intrastate gas transportation tariffs filed by local distribution companies (LDCs) in the state. Earlier in the year it had issued a set of "tentative" regulations to serve as a basis for discussion of changes in the gas industry. See Re Gas Transportation Tariffs, 169 PUR4th 212 (Pa.P.U.C.1996).

According to the PUC, the final rules are based on a "reasonable sharing" of opportunities, risks, and obligations. A major objective is to maintain LDC responsibility for designing and maintaining the local distribution system as well as pursuing least-cost procurement practices, while ensuring that customers who choose to transport their own gas recognize and accept the risks and operational responsibilities. Without adopting a statewide formula for balancing service tariffs to apportion such risks and obligations between transportation users and LDCs, the PUC refused to place balancing costs and penalties on a "no harm/no foul" basis. The rules also permit transportation users to "pool risks with each other" as long as they agree to pay the costs of the risk-sharing mechanism. Re Gas Transportation Tariffs, Dkt. No. L-00930084, Aug. 8, 1996 (Pa.P.U.C.).


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