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Competition Moves N.Y. To Protect Core Gas Supply

Fortnightly Magazine - March 1 1997

Concerned that competition in the natural gas market might affect reliability of gas supply for core customers, the New York Public Service Commission has adopted new short-term curtailment procedures for the states natural gas local distribution companies.

According to the commission, the new procedures "recognize the restructured natural gas industry," and require that in the event of short-term interruptions or force majeure curtailment situations, the needs of core customers are met first.

Replacement cost of fuel is established as the proper compensation to customers if gas supplies are diverted from non-core to core customers under the curtailment policy. If the non-core customer must switch to an alternate fuel, the replacement cost is the market value of the equivalent volume of alternate fuel. If the non-core customer does not use an alternate fuel, it will be the market value of the displaced gas. Re Restructuring of the Emerging Competitive Natural Gas Market, Case 93-G-0932, Dec. 3, 1996 (N.Y.P.S.C.).


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