Regulators in Pennsylvania and New Jersey have taken steps to address relationships between natural gas utilities, customers, marketers and brokers operating in their respective states, announcing policies to cover such topics as fitness requirements, marketing practices and consumer protection.
One question that continues to raise concern is price arbitrage by marketers during supply emergencies that might affect service to captive residential customers.
Pennsylvania. The Pennsylvania Public Utility Commission has issued standards for residential gas marketing, plus a final policy statement regarding fitness standards for utility and nonutility natural gas marketers and brokers operating in the state.
The policy statement requires gas utilities to consult with marketers and brokers in their service territory to develop transportation tariff provisions. The provisions would govern technical and financial requirements for a marketer or broker to enter the utility's service territory.
The commission said that its jurisdiction over the private suppliers was limited. It said such companies are not "public utilities" as defined under state law and the contracts for nonutility gas supply are between the marketer or broker and the end-user. Nevertheless, it has the power to regulate the operations of participants in the gas market to ensure that gas service is "safe, adequate and without unreasonable interruption or delay." In adopting financial and technical fitness requirements necessary to maintain gas system reliability, the commission said that it would make sure that local distribution utilities do not use the rules as "leverage" to impose market impediments in favor of affiliates.