To help gas customers take advantage of unbundled services, the New York Public Service Commission has authorized National Fuel Gas Distribution Corp. to modify its existing firm transportation service procedures to allow marketers to gain access to a share of utility storage capacity, for use in delivering the required volume of gas to the city gate.

In another ruling, the commission approved a similar, but less innovative storage proposal for firm transportation customers served by Central Hudson Gas & Electric Corp.

Unlike other storage proposals recently approved by the commission, the proposal in the National Fuel Gas case would provide for the actual release of storage directly to marketers. The commission found that the innovative service option should foster competition in the local gas market.

The new service would give aggregated customer groups direct access to a pro-rata share of the LDC's storage, based on the group's load factor. This storage is in addition to the pipeline capacity currently used by suppliers of customer-owned gas to meet customer needs. Storage capacity is released to the supplier, who then becomes responsible for using it to deliver a required volume of gas to the citygate on a daily basis. The released storage is in addition to the pipeline capacity used by suppliers of customer-owned gas to meet customer needs.

The commission ruled that immediate approval of the plan was necessary to give marketers and customers enough time to take advantage of unbundled services for the coming heating season. It also approved a similar plan for Niagara Mohawk Power Corp.

By contrast, the proposal approved in the Central Hudson case allows customer access to utility-held storage without actual release of the storage capacity. Under this plan, the LDC retains responsibility for managing the storage. Re National Fuel Gas Distr. Corp., Case No. 95-G-1042, June 26, 1997 (N.Y.P.S.C.); Re Niagara Mohawk Power Corp., Case 95-G-1048, June 26, 1997 (N.Y.P.S.C.); Re Central Hudson Gas & Elec. Corp., Case 95-G-1039, June 26, 1997 (N.Y.P.S.C.).

Phillip S. Cross is an associate legal editor of PUBLIC UTILITIES FORTNIGHTLY.

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