The Federal Energy Regulatory Commission (FERC) has approved a comprehensive settlement for Southern Natural Gas Co. (SNG), resolving the company's costs associated with its transition to Order 636. The settlement resolves
23 rate cases, reduces rates, and provides about
$146 million in customer refunds (Docket No. RP89-224-000, et al.). Protesting parties have been severed from the case.
The refunds, plus $9.1 million contributed by SNG, will serve as a credit toward customers' liability for SNG's cost of realigning gas supplies under Order 636. The FERC allows pipelines to recover from customers prudently incurred costs attributable to the transition from merchant to transporter. Consenting customers agreed to forgo litigation over the gas supply realignment (GSR) costs in return for protection from rate hikes for three years. The FERC also approved a pipeline expansion that enables SNG to improve service to major customers such as Atlanta Gas Light Co. and South Carolina Pipe Line Corp. The two companies agreed to remain firm customers for three years.
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